GST brings the curtains down on 100 cinemas theatres in Karnataka

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From Bengaluru to Koppal, it’s the same story. Be it the Himalaya theatre in Koppal or the Central theatre in Mangaluru or the Vinayaka theatre in Shivamogga, these theatres which were once regarded as popular single screen theatres in A centres, are now a sepia-tinted memory. Sadly, their reputations could not insulate them from the effects of the Goods and Service Tax (GST). Nearly 100 single screen theatres — in A, B and C centres— have either shut down or are on the verge of closure. Unable to tide over the severe hit to margins following the introduction of GST, these theatres have shut down for ever. Some of them have been turned into godowns, while some others have been demolished and rebuilt as commercial complexes.

The categorisation of A, B, C depends on the location (city/district centre, taluk centre, hobli/village centres). Jayanna, one of the top film distributors in Kannada says, “The list of theatres shutting down is growing by the day. Many distributors have given up on theatre lease as it has become unprofitable to run single-screen theatres. In the last one year, the total number of theatres in Karnataka has come down by around 100.” Some of the theatres in main cities and towns which have shut down are CMS (Chennambika) in Bhadravathi, Shankar in Chitradurga, Girija in Mandya and Bhanu in Hassan.

GST on films is imposed in two slabs. For tickets priced below Rs 100, it is 18 per cent (9 per cent of Central GST and 9 per cent of State GST) while tickets above Rs 100 attract a GST of 28 per cent. Margins therefore have come down by at least 18 per cent automatically. Another top distributor Jack Manju said that paying GST has become a pain for theatre owners. “In small towns and villages, theatre owners do not even find auditors to file their GST returns. They are finding it extremely difficult to comply. It is easier for them to convert the theatre into a wedding choultry. A commercial complex will ensure regular rent,” he said.

The Kannada film industry has also given up hopes of the State Government willing to forego its share of the GST. “The earlier government had promised such a measure. But it is forgotten now. There is no hope,” said Manju. Jayanna cites another problem. “Big stars in Kannada, except Shiva Rajkumar, act in only one film a year. This does not bode well for the single screens. The Villain which released in around 450 single screens last week will sustain single screens for weeks. Most theatres will screen them for two to eight weeks. If there are films of big stars are frequently released, single screens will not feel the heat as much. The top stars are as much to blame for the woes of single screens as GST,” he said.

Read More at: https://bangaloremirror.indiatimes.com/bangalore/cover-story/gst-brings-the-curtains-down-on-100-cinemas-theatres-in-karnataka/articleshow/66324329.cms