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Indian Tax Solutions

Indian Tax Solution

No big impact on ticket prices post GST Revision

About a year and a half ago, cinema ticket rates were hiked after GST came into effect. And now, with the central government revising GST rates, the rates have been lowered.The GST for tickets which were priced above Rs.120 has come down to 18% from 28%, and for those priced below Rs.100, it has now been reduced to 12% from 18%. A few theatre owners open up on what this revision mean for the audience GK Cinemas on the outskirts of the city has reduced its ticket rate from Rs.120 to Rs.110. Ruban Mathivanan, managing director, says this slight reduction may not create a big impact. He explains, "A decrease of Rs.10-15 may not have a reasonable impact among the audience. The scenario would have been different if it was above Rs.30. If the local body entertainment tax levied by the state government is removed, which is unlikely, then, there is a strong chance of theatres gaining more footfalls".

There are a few who opine that the current change in ticket rates may have some impact among the rural audience. Lingesh of SK Marlen Cinemas, which has slashed its ticket price by Rs.10-20,
says he isn't expecting the audience to throng theatres because of this reduction. "There is hardly anything for audience to cheer about as there isn't a major lowering in the price. But this will
make audience from rural areas happy. They can spend that Rs.10-15 on snacks. For example, the crowd coming to SK Marlen in Alandur is different from those who go to our own branch, Sree Gopikrishna Paradise at Ayanavaram. Unlike the former, which draws a good bunch of IT employees, the latter attracts an audience that is largely daily-wage labourers. This mild reduction in ticket rate is enough to keep them happy". The slashed ticket price may not create a big impact as far as multiplexes are concerned, notes Udeep B, managing director, Mayajaal Entertainment Limited. "The audience who come to multiplexes are ready to spend ample money for entertainment. I don't think this slight reduction in ticket prices will be a big relief for them. We were charging Rs.207 for Tamil films - now, it's come down to Rs.190. Maybe people might think they can watch a film at our screens for less than Rs.200 now, but that isn't really a reason to cheer," he says.Selvam of Manghalam Cinemas, Trichy, too, feels the same. He says, "As regular film lovers have become used to a certain ticket rate for more than a year, we can't say that the present fall in rate would be a relief for them."

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