Karnataka Chamber asks for TAX REIMBURSEMENT for Kannada Films
GST reimbursement must be a tax incentive for Kannada films: Experts
The Kannada film fraternity on Tuesday urged the state government to keep its promise of reimbursing the tax paid on film tickets in the upcoming GST regime.
Tax experts, however, suggested industry leaders seek the GST reimbursement as an incentive rather than exemption so that they are eligible for input tax credit.
Film personalities, including producers, distributors, and exhibitors interacted with tax experts and officials from the department of commercial taxes at an event held at Gandhi Bhavan. The interactive session was jointly organized by the department of information and public relations, Karnataka Chalanachitra Academy, department of commercial taxes, Karnataka Film Chamber of Commerce and Federation of Karnataka Chambers of Commerce and Industry .
“Kannada films must get the tax reimbursement. Chief minister Siddaramaiah has promised on the floor of the assembly that the government would reimburse the tax paid. I'm sure he'll keep his promise,“ said Jayamala, actor and member of legislative council.
The GST council has decided to impose 18 % GST on film tickets priced less than Rs 100 and 28% if the tickets cost more than Rs 100. Equal portions of the tax will go to the central and state governments. While Kannada movies are enjoying taxfree benefit in the current regime, the Karnataka government has promised to reimburse its share of GST.
“The move to reimburse the tax is welcome, but it's going to be a complicated one, with questions looming over whom to reimburse,“ said Vivek Mallya, a chartered accountant and tax consultant. He said the government must devise a policy so the the tax reimbursement is made to the producer of the film rather than the exhibitor.
“The producer is the one who has invested on the product and he should get the benefit of tax reimbursement,“ said Mallya. He said the reimbursement should be in the form of tax incentive and it should be paid on the lines of incentives to exports. An exporter gets 90% of the incentive within seven days even without applying for it.
Srinivas, a tax lawyer, said there should be a mechanism whereby the tax reimbursement is made through the department of Kannada and culture or the department of information and public relations, like how the department of industries incentivises industries.
Speaking on the occasion, S V Rajendra Singh Babu, chairman of Karnataka Chalanachitra Academy, said he welcomes GST as it'd wipe out the menace of tax evasion.