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Cinema halls threaten shutdown from Friday


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More than 900 cinema halls in Maharashtra have threatened an indefinite shutdown from Friday alleging that the state has gone back on its word to reduce entertainment taxes.

The stir has been jointly called by the Cinematograph Exibitors' Association of
India and the Theatre Owners' Association.

In a joint statement issued here, the two associations alleged that the government went back on its promise of reducing entertainment tax from 55 percent to 45 percent. The body also alleged that the state has not permitted theatres to increase service charges from Rs.2 to Rs.3 for halls without air-conditioning and Rs.4 for the air-conditioned ones.

The statement noted that despite both houses of the state legislature having passed a bill to this effect and Governor Mohammad Fazal having given his assent, the government did not publish any notification to implement the changes.

Government officials refused to comment, saying they could not do so while the state legislature was in session.

According to an agreement between the state government and theatre owners, cinema halls were supposed to have availed of the concessions late last year.

Theatre owners are also demanding electricity supply at concessional rates, abolition of municipal taxes, delinking property tax from box office collections and exemption on taxes for film hoardings in theatre premises, among others.

Theatre owners say the policy to encourage multiplexes has also affected their earnings. More than 40 theatres have closed down in Mumbai alone due to high operating costs.

Multiplexes are eligible for zero entertainment taxes for the first three years and 75 per cent exemption for the following two years.

In order to avail of this facility, a multiplex complex in Mumbai needs to have at least four theatres with a total seating capacity of 1,250. In smaller towns, multiplexes may have three theatres, seating a total of 1,000 viewers.

Though the law does not permit multiplexes to price tickets lower than the single-screen theatres, economics of the film industry are heavily loaded in their favour, claim theatre owners.

They cited the example of new films being released that do not attract enough viewers. This leads to the bigger theatres going empty while the smaller theatres in multiplexes often sport a full house.

At present, Mumbai alone has nearly 30 multiplex complexes with more to follow. Some of them have come up in the form of shopping-cum-entertainment complexes after pulling down single-screen theatres.


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