Producers' association demands to abolish GST on film industry
The Indian Motion Picture Producers' Association (IMPPA) on Wednesday wrote a letter to Finance Minister Nirmala Sitharaman, requesting her to abolish or "substantially reduce" GST on the film and entertainment industry to help revive the sector amid the pandemic.
The association, in its letter addressed to the FM, requested Sitharaman to consider "the pain and agony" the industry is going through due to "extreme taxation and also GST being levied at 18 per cent".
The IMPPA claimed that the GST (goods and services tax) is levied at an extremely high rate, especially when this is an industry where the government makes no investment but "takes away the lion's share in the income generated".
"Therefore in such an industry, where the entire capital is being contributed by the entrepreneurs, and today at a stage where the industry has reached a dead end due to the pandemic, it has become necessary that new blood and strength be pumped into the industry... By way of abolishing GST and all other taxes as a one-time measure to revive the industry," the letter read.
The association, which has nearly 6,000 members, said the government has given "massive tax exemption and subsidy" to numerous multiplexes and exhibition outlets, which solely depend on the sale of tickets and struggled during the closure of cinema halls due to the pandemic.
"It is a business which solely runs on the income generated by sale of tickets, which also gets sold only if the film appeals to the public enough to inspire them to pay money and buy tickets.
"Therefore if the industry is to survive it needs films and the government should immediately take necessary steps to abolish or substantially reduce GST on the M&E industry."
Cinema halls across the country were shut for most part of 2020 due to the coronavirus-induced nationwide lockdown.
The exhibition sector saw a phased opening following the second wave of the pandemic earlier this year.
The letter, signed by IMPPA president T P Aggarwal, observed that producers are still facing a severe financial crisis, while the central and state governments make "huge income out of various taxes imposed at almost all levels of film production".
"It is high time that the government provides immediate financial as well as entertainment relief to the poor citizens of the country by either abolishing GST on the Film and Entertainment industry.
"Or at least reduce it to the lowest level of five per cent all over the country in a totally uniform manner which would be highly appreciated by the industry," it read.