Kochi: The theater business has seen a boom in the last five years as around 250 new theaters were built in Kerala. More than Rs 1000 crore have been invested in these new theaters. Most of these theaters were built by availing loans up to Rs 3 – 15 crores. However, the Covid 19 pandemic made entry as a distasteful villain that shattered the hopes of the industry.
The Malayalam movie and theater industry is staring at severe financial crises as it has been more than 150 days since the theaters were closed down. Though the owners have appealed to the state and the central governments to reduce the GST rate, entertainment tax and the electricity fixed charge, they haven’t received any positive response.
Tax burden
The government receives around Rs 650 crore as entertainment tax from the theaters. But the theater owners are disappointed that no one has helped them during this time of crises. The corporations, municipalities and panchayats too receive around Rs 150 crore as taxes. Meanwhile, the state and the central governments get Rs 400 crore as GST. The income from the ticket sales goes into the welfare fund for artists. This comes up to Rs 70 crore. Besides, Rs 30 crore is given as flood CESS. Moreover, an additional amount of Rs 30 crore is collected from the theaters as miscellaneous taxes including building tax, labor tax and various license fees.
Looming concerns
Around 20 screens are currently under various stages of construction. The theater complex which was built at Haripad by spending Rs 20 crore had to close down within a year due to the Covid 19 outbreak. Meanwhile, a theater at Kochi that was renovated for Rs 13 crore was shut down just 18 days after it was reopened. The theater owners who have spent crores of rupees are now staring at blank screens and empty seats, unsure about their future.
