Multiplex Association Calls on Government to Set Film Ticket GST at 5% for Prices Below Rs 300

Cinema and multiplex operators are urging the government to lower the GST rate for film tickets priced below Rs 300 to 5 per cent. This change aims to make cinema more affordable and support the struggling film exhibition industry, according to the Multiplex Association of India (MAI). Currently, tickets over Rs 100 fall under an 18 per cent GST slab, while those below are taxed at 12 per cent.

MAI President Kamal Gianchandani suggests raising the Rs 100 slab to Rs 300, so tickets up to Rs 300 would attract only 5 per cent GST. "We are recommending that the Rs 100 slab be raised to Rs 300, so ticket prices till Rs 300 should attract 5 per cent GST, and anything higher than Rs 300 should attract 18 per cent GST," he stated.

GST Rationalisation for Cinema Tickets

The current Rs 100 slab is outdated, Gianchandani noted, and this issue has been raised with the finance and I&B ministries over the past seven and a half years without change. He believes a Rs 300 slab would make cinema tickets more affordable and boost confidence in the exhibition sector, which is crucial for growth.

The average ticket price in India is approximately Rs 170-175. If the government's recommendation is accepted, ticket prices could drop by at least Rs 20-25. This reduction would benefit consumers and potentially increase cinema attendance.

Challenges in Food & Beverage Taxation

MAI represents over 9,000 screens nationwide, including 4,000 multiplex screens and 5,000 single screens. They argue that the cinema exhibition industry is ideal for GST rationalisation. However, food and beverages in cinemas are treated as restaurant services without input tax credit (ITC), complicating tax efficiency.

"All inputs that we purchase from our partners and vendors, we are not able to set off the GST that we pay on it, towards our output GST, so currently there is inefficiency, complexity existing in the GST structure as far as the F&B part of our business is concerned," Gianchandani explained. Simplifying this structure by allowing ITC would improve compliance and reduce complexity.

By addressing these issues, MAI believes that both cinema operators and audiences will benefit. The proposed changes aim to revitalise an industry still recovering from pandemic-related challenges.

With inputs from PTI