Karnataka government considering 2% cess on movie tickets, OTT subscriptions
The Karnataka government is considering the imposition of a cess on movie tickets and Over-the-Top (OTT) subscription fees to support local cinema and cultural artists. The proposed tax, which could range from 1 to 2%, will be subject to review every three years. This levy would apply not only to cinema tickets and subscription fees but also to revenue generated from related establishments within the state.
Welfare bill for cinema and cultural activists tabled
The Karnataka Cine and Cultural Activists (Welfare) Bill, 2024, proposing this measure, was tabled in the state assembly on Friday, July 19. The bill suggests the establishment of a seven-member welfare board and a fund to finance schemes aimed at providing social security for artists. It defines a cinema and cultural activist as "any individual working in the film industry as an artist (actor, musician, dancer, etc.) or in any manual, supervisory, technical, artistic or unskilled capacity."
Cess extension and phased implementation proposed
Officials have stated that the state government is also planning to extend the cess to theatrical plays staged within Karnataka. The bill proposes a phased implementation to minimize the impact on the state budget and prevent financial strain. It mandates employers to deposit the cess monthly and submit biannual returns online or through a designated web portal.
Establishment of Karnataka Cinema and Cultural Artists Welfare Board
If passed, the bill will establish the Karnataka Cinema and Cultural Artists Welfare Board in Bengaluru. The board will be chaired by the department minister and a senior IAS official. Seventeen government-nominated members representing various cultural sectors and academies will also be part of this board. Just last month, the Karnataka government had also increased the Value Added Tax (VAT) on petrol to 29.84% and on diesel to 18.44%.
BJP spokesperson criticizes proposed cess
The proposal has been criticized by Bharatiya Janata Party (BJP) spokesperson Shehzad Poonawala, who described it as "one more jhatka for Karnataka people." He stated that after imposing taxes on milk, petrol, diesel, bus fares, and water, the Congress government is now planning to make cinema tickets costlier. Labour department officials are currently working on the modalities of how the cess on OTT subscriptions can be collected.
