“Benefit of tax exemption should go to film industry”

The Tamil Nadu Government has said the entire monetary benefit in the exemption of entertainment tax is to be passed on to the film industry and not to film viewers.

It was responding to a writ petition seeking to quash a circular of May 6, 2014 of the Commercial Taxes Department.

In the petition filed through counsel Richardson Wilson, the petitioner K.J.Saravanan of Nandanam, submitted that the impugned circular gave a clear chit to theatre owners to fleece filmgoers by printing tickets as if the entire price was collected towards admission rate. The question was whether a viewer was really benefitted by the tax exemption.

Responding to the petition, the Principal Secretary, Commercial Taxes Department, K.Rajaraman, submitted that theatre owners were collecting admission fee as per the Tamil Nadu Cinemas Regulation Act. As regards the petitioner’s contention, he said the entire monetary benefit in the entertainment tax exemption was to be passed to the cinema industry as mentioned in the budget speech of 2006-07.

This has been mentioned in the circular too. The exemption benefit was not for viewers. The petition had been filed on a wrong understanding of the law.

The grant of exemption of entertainment tax had been introduced with a particular cause of encouraging the film industry and promoting the Tamil culture.

This was a policy decision of the Tamil Nadu government and the petitioner could not be permitted to attribute intentions for the same.

Justice S.Vaidyanathan posted the matter for further hearing on March 30.


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