Theatre owners fear revenue loss

Wary of burden of local body tax

While cinema owners may have withdrawn their strike on Thursday, at least some of them are fearful of having to pay the 30% local body tax as the GST has been passed on to the consumer.

“There are two problems: an unreasonably high 58% (GST + local body tax) double tax and an unreasonably low cap of ₹120 on movie tickets. While ticket prices have to be increased to account for inflation and increase in operational costs, paying more than the 28% GST is unacceptable,” said a cinema owner.

Tendering change

Cinema owners will face other practical problems such as providing exact change to movie-goers who buy tickets from the counter.

“A ₹ 120 ticket will now cost ₹ 153.6 after adding GST and a ₹10 ticket will now cost ₹11.80. Similarly, a ₹60 ticket will cost ₹70.8. While card transactions are not a problem, providing exact change will be a concern. We may have to forego the change,” said another cinema owner.

The makers of the two movies,

Ivan Thanthiran and

Vanamagan, which were badly affected by the shutdown,

came together and announced on Thursday evening after the strike was withdrawn that the films would re-release in theatres across the State from Friday.

While Ivan Thanthiran had released on June 30 and was in the theatres only for three days before the strike began, Vanamagan had released the week before the shutdown.

“The exhibitors association of Tamil Nadu has promised me that they would give us the net collection for the first three days without taking the exhibitors’ share to compensate for the loss accrued due to the shutdown. I am confident that they will honour their commitment. The movie took off very well in the first three days. I was expecting ₹2 crore this week, which I am losing,” said G. Dhananjayan, who is distributing Ivan Thanthiran .

But the increase in taxes after the GST came into force would have meant that he would have in any case lost a substantial amount of money even if the theatres had not shut, Mr. Dhananjayan said.

The makers of both the movies appealed to the audiences to support the films and watch them in theatres.