The easiest way to kill the character and purpose of Goods and Services Tax (GST) is to bring as many distortions as possible to it. One way of doing it is by imposing significant additional levies above the already agreed GST rates, terming it necessary to compensate losses for states. That is exactly what states like Maharashtra and Tamil Nadu are doing by forcing additional tax above GST rate on new vehicle purchases and on movie tickets, respectively.
Tamil Nadu has imposed an additional 30 percent tax on movie tickets in addition to the 28 percent (for tickets priced above Rs 100) and 18 percent (for tickets less than Rs 100) GST rates. That would make the majority tax incidence for the industry close to 60 percent. Reason: Only about 10 percent of the total share of movie tickets sold is below Rs 100 ones and these make up only about 6 percent of their revenues, a Times of India report quotes Deepak Asher, President, the Multiplex Association of India, as saying. In the pre-GST regime, the pan India tax rate on movie tickets was 19.5 percent. Hence the clamour in Tamil Nadu led by the likes of Kamal Hassan is least surprising.
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More on: GST was never 'one nation, one tax'; Tamil Nadu, Maharashtra only putting final nail in its coffin
Tamil Nadu has imposed an additional 30 percent tax on movie tickets in addition to the 28 percent (for tickets priced above Rs 100) and 18 percent (for tickets less than Rs 100) GST rates. That would make the majority tax incidence for the industry close to 60 percent. Reason: Only about 10 percent of the total share of movie tickets sold is below Rs 100 ones and these make up only about 6 percent of their revenues, a Times of India report quotes Deepak Asher, President, the Multiplex Association of India, as saying. In the pre-GST regime, the pan India tax rate on movie tickets was 19.5 percent. Hence the clamour in Tamil Nadu led by the likes of Kamal Hassan is least surprising.
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More on: GST was never 'one nation, one tax'; Tamil Nadu, Maharashtra only putting final nail in its coffin