The Telegraph
Since 1st March, 1999
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Theatres in tax SOS

Mumbai, May 11: A city full of cine stars but without cinema halls'

Mumbai may be difficult to imagine without its theatres, but if harried owners of movie halls are to be believed, the city may well be shorn of its silver screens because of the high rate of entertainment tax.

Theatre owners, who have threatened to go on an indefinite strike from May 16, jeopardising the release of a multitude of big-banner films, have now petitioned the chief minister to bail them out of their “taxing” misery. The owners, who gathered to send the SOS to Sushil Kumar Shinde, have let out not just a wail of anxiety but also some disturbing data. Nearly 200 movie halls have shut shop in the state in the last five years, they said.

While Maharashtra had 1,181 theatres in 1997-98, it can only boast of 988 now. “But even these will close down,” a worried Nester D’Souza, president of the Central Exhibitors Association of India, said, adding that unless the government took some urgent measures to bail out the ailing business all would be lost.

“The crisis is worsening each passing day,” D’Souza said, at a press conference at the Excelsior Cinema in south Mumbai. “The economics of cinema exhibition is collapsing.”

The emergency meeting of theatre owners was attended by the rival Theatre Owners Association and the Central Circuit Cine Association. Cinema halls, the associations said, were being forced out of business by the “sky high” 60 per cent entertainment tax.

The associations are also demanding the abolition of the service tax of Rs 5 per ticket, “especially at a time when occupancy has started hovering around below the 30 per cent mark”.

The hall owners, who have to contend with pirated film CDs and cable TV operators who do not shy from surreptitiously showing the newest films to subscribers, said the government has to reduce the entertainment tax to 30 per cent. Among their other demands are supply of electricity at concessional industrial tariff — “as film is recognised as an industry” — and no insistence on no-objection certificates from the films division for renewal of licence.

They are also demanding that the show tax imposed by municipal bodies should be waived and the levy of property tax should not be linked to box-office collections. “We have appealed to the chief minister as a last resort or we will be forced to close our theatres from May 16,” D’Souza said.

The owners are angry that the Maharashtra Cabinet’s earlier decision to provide marginal relief in entertainment duty to the exhibitors has not come off the drawing board.

“States like West Bengal, Delhi and Chhattisgarh have reduced entertainment duty to 30 per cent and they provide other reliefs such as enhancement in tax-free service charge, abolition of show tax and de jure industry status to the film industry in its entirety,” the statement of the exhibitors’ association said.

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