India is globally the fifth largest media and entertainment market. The media and entertainment (M&E) industry has outperformed expectations, and is one of the fastest growing sectors of the economy providing employment to a large number of people thereby contributing a major chunk to the economic development. With the expansion of the economy, the sector has been growing at its own pace, backed by rising consumer demand and improving advertising revenues.
The industry has been growing due to increase in digitization and internet usage over the last decade. Internet has almost become a mainstream media for entertainment for most of the people. Entertainment industry of a country includes big and small screens, media, events, exhibitions, theme & amusement facilities, gaming zones, motion pictures and televisions, cine actors and cine actresses, content & script writing, broadcasting & telecasting, talent and celebrity management , music & music celebrity, internet & digital media, media & publishing and other activities which are ancillary and incidental to any of these activities. GST reform that came into effect recently has been making a lot of changes in all the sectors of the economy.
Taxation of Education Sector under GST Regime
When it comes to the entertainment industry, following are the tax rates that have been levied:
DESCRIPTION |
GST RATES |
| · Services by way of admission to a museum, national park, wildlife sanctuary, tiger reserve or zoo. | 0% |
| · Services by way of admission to exhibition of cinematograph films where price of admission ticket is one hundred rupees or less. | 12% |
| · Television: GST on broadcasting services (D2H / Cable TV services)
· Services by way of admission to exhibition of cinematograph films where price of admission ticket is more than one hundred rupees. |
18% |
| · Supply of Services by way of admission to entertainment events or access to amusement facilities including exhibition of cinematograph films, theme parks, water parks, joy rides, merry-go rounds, go-carting, casinos, race-course, ballet, any sporting event such as Indian Premier League
· Gambling · the supply of Services provided by a race club by way of totalisator or a license to bookmaker in such club |
28% |
- Prior to GST, there was entertainment tax that used to be levied in the industry, where the rates ranged from 0 to 110%, with an average of 30%. But since, Entertainment tax is subsumed under GST now, the overall tax burden on consumers has been reduced. Entertainment tax was higher than GST rate and it was levied by local bodies that lead to the cascading effect of taxes.
- GST rate for cinema tickets less than Rs. 100 is 12% and for the tickets above Rs. 100 GST rate is 18%.
Check the GST calendar
- The reduced rates under GST has been seen as a “progressive step” . It has attracted investments in both exhibition infrastructure and creative development. It has enabled penetration in multiplexes more in smaller towns.
- Greater Transparency and easy tax compliance procedures has made GST one of the most prudent achievements of the country.
New GST Payment and Input Tax Credit (ITC) calculator
Introduction of GST has stabilized the rate variance and has provided a uniform market across the nation. Thus it has been considered as a welcoming step. Things have become relatively simpler for the entertainment industry. It has grew at a CAGR of 10.90 per cent from FY17-18; and is expected to grow at a CAGR of 13.10 per cent to touch Rs 2,660.20 billion (US$ 39.68 billion) by FY23 from Rs 1,436.00 billion (US$ 22.28 billion) in FY18. It has unified the indirect tax administration in India. It has served the whole purpose of having a single tax regime in all the sectors of the economy. Thereby unleashing the full potential of all the industries especially the entertainment industry.
For any question visit us at forum
The author of above article is Tanuja Puri, Assistant Professor.
You can also submit your article by sending a mail to [email protected] or whatsapp us at 7024984925.
