High taxes under the dual GST structure and limited government support have become major concerns for Indian film exhibitors, who are now pushing for rationalisation in GST on movie tickets. The Multiplex Association of India (MAI) has urged the Centre to consider a simplified tax structure that could accelerate screen growth and make cinema more affordable for the masses.
Multiplex Industry's Proposal
The MAI has suggested that movie tickets priced up to Rs 300 should attract just 5% GST, while tickets priced above Rs 300 can continue to attract 18% GST. Currently, tickets priced up to Rs 100 are taxed at 12% and those above Rs 100 face 18% GST-a structure that came into effect in 2018.
According to the MAI President, the existing Rs 100 tax bracket has become irrelevant due to inflation and changing cinema consumption habits. "Even in 2018, Rs 100 was impractical. Today, bulk of the tickets fall under the 18% GST slab, making it unaffordable for many moviegoers," he said.
Push for 20,000 Screens in India
India currently has around 9,000 screens, with nearly 5,500 concentrated in South Indian states such as Tamil Nadu, Karnataka, Andhra Pradesh, Telangana and Kerala. With GST rationalisation, the industry believes India could scale up to 20,000 cinema screens over the next 7-8 years, fueling both job creation and economic growth.
"Lower GST will directly reduce ticket prices by Rs 40 per ticket, making movies more accessible to middle-class families in Tier I and Tier II cities. This affordability will drive higher footfalls and encourage expansion in smaller towns," the MAI head added.
Pandemic Impact and Slow Recovery
The Covid-19 pandemic dealt a severe blow to the exhibition industry, with many single-screen cinemas shutting down permanently due to losses and changing audience preferences towards OTT and short-form content. Multiplex chains like PVR INOX have been adding 200-250 screens annually post-pandemic, compared to 300-350 screens before 2020. However, they have also been forced to shut down non-performing properties.
Industry representatives argue that a supportive tax regime could restore confidence, accelerate investment, and revive growth in the sector. "The government's policy push can provide the same tailwind that the entertainment tax holiday did in the mid-1990s, which sparked the multiplex revolution in India," said the MAI President.
India's Tax Burden Among Highest Globally
India currently has one of the highest tax structures on cinema tickets compared to other major markets. For instance, China levies less than 10% tax on movie tickets, enabling faster screen growth and stronger box office performance.
With just 8 screens per million people, India remains one of the most under-screened countries in the world. Industry stakeholders argue that GST reform on movie tickets could be the catalyst needed to bridge this gap and unlock the true potential of India's cinema market.
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