2 months, 1 week ago mycaguruKeymaster
GST Key effect on Entertainment and Media area: GST was presented in India on 1 July 2017 and was material all through the nation aside from in the province of Jammu and Kashmir where it was presented on 8 July 2017. Presentation of GST is a critical advance in the field of Indirect assessment changes in India. By amalgamating a substantial number of Central and State charges into a solitary assessment and permitting set-off of earlier stage charges, it would alleviate the evil impacts of falling and prepare for a typical national market. Presently check GST Impact on Entertainment and Media Industry from underneath… .
GST Impact on Exhibition of Films
Pre-GST Post GST Movie tickets: Service tax or VAT was not levied on sale of movie tickets. However, state specific Entertainment tax ranging from 15% to 110% (with an average of 30%) was levied on sale of movie ticketsTelevision: There was dual levy of service tax (15%) and Entertainment tax (in the range of 8-12%) on broadcasting services (D2H / Cable TV services) Movie Tickets:
- GST rate of 18% in case where price of tickets is INR 100 or less
- GST rate of 28% in case where price of tickets more than INR 100
Television: Broadcasting services attract GST rate of 18%
Stimulation assess subsumed under GST and fungibility of info impose credits: Before GST administration, the tickets of movies used to pull in Entertainment Tax in view of the State laws. No set off was accommodated Entertainment Tax against Service Tax or VAT paid by the exhibitors on obtainments thus the duties were total and a definitive client used to endure the weight of charges. With the presentation of GST, the amusement assess required by the State Government is subsumed, which may decrease the last cost of motion picture tickets to shoppers in states where Entertainment charge was higher than GST rate
Power gave to Municipality to Tax on excitement and beguilement:
Under GST administration, an expert is given to nearby bodies to impose and gather charges on excitement and delight. This seems, by all accounts, to be a secondary passage section of excitement impose and if required by the nearby bodies, would expand the cost to shoppers.
For example, Entertainment charge is imposed in Tamil Nadu at the rate of 8% on Tamil Films and 20% on different movies which brings about critical increment in charges on motion picture tickets. Additionally, impose of Entertainment charge prompts falling impact of duties since Entertainment assess sum would be incorporated into the base an incentive for exact of GST Industry from beneath… .
GST impact on Exhibitors – Food & Beverages (F&B)
Pre-GST Post GST There was an issue of dual levy of VAT and Service tax on supply of F&B at theatre counters. Though F&B were purchased outright by exhibitors and sold at counters, in certain cases there is an element of preparation involved (like preparing pop-corns, coffee etc.) and hence, service tax demands were raised on supply of F&B Supply of F&B over the counter at theaters is to be treated as restaurant services and levied to GST rate of 18% (A/c counters) and 12% (non- A/c counters)
Impact: Issues as regards classification of an activity as a sale of goods or services and levy of VAT or Service tax will go away
Pre-GST Post GST Transfer of copyright for exhibition of movies in Theatre:
- Temporary transfer or permitting use of enjoyment of copyright relating to cinematograph films for exhibition in a cinema hall or theatre was chargeable to Service tax.
- IPR such as trademarks, copyrights were also treated as goods and attracted state VAT
- Grants of license for theatrical release was exempt from service tax
- Due to exemption from Service tax and VAT, producers incurred significant tax cost on procurement of goods/services including service tax charged by actors, technicians etc.
Transfer of copyright for exhibition on Television:
- In case of certain lease of film/television content rights, there was a controversy as to whether the transactions were that of a sale of goods or provision of service and hence, there was an issue of dual levy of Service tax and VAT on transfer of copyright for exhibition on television
Transfer of copyright for exhibition in Theatre and Television:
- Temporary or permanent transfer or permitting the use or enjoyment of Intellectual Property (IP) right in respect of goods is to be treated as supply of services attracting GST rate of 12%
Impact: Issue on levy of service tax or VAT on license to use the copyright will go away and thereby the effective tax rate on such services will reduce
Levy of GST on grant of license for exhibition in theatre will necessitates an increase in working capital requirement but will also allow smooth flow of input tax credit in the value chain
GST Impact on Advertisers
Pre GST Post GST
- Print media was exempt from service tax
- All other advertisement services were subject to service tax of 15%
- Selling of spare for advertisement in print media attracts GST rate of 5%
- All other advertising services attract GST rate of 18%
- No tax exemption to print media which enables them to now claim input credit on all services procured by them.
- GST is in addition to the equalization levy introduced on online/digital advertising
GST Impact on Artistes / Sponsorship / Brand Promotion
Pre GST Post GST
- Services of film artistes were liable to a service tax of 15% on forward charge basis
- Sponsorship services, subject to certain exceptions attracted service tax
- Brand Promotion were also liable to service tax
- Supply of services by an author, music composer, photographer, artist or the like by way of transfer or permitting the use or enjoyment of a copyright covered under clause (a) of sub-section (1) of section 13 of the Copyright Act, 1957 relating to original literary, dramatic, musical or artistic works to a publisher, music company, producer or the like, to be taxed at 18% GST on reverse charge basis
- Supply of services by artistes other than above, to be taxed at 18% GST on forward charge basis
- Sponsorship/Brand Promotion services will be liable to GST
- Indian diversion and amusement stop industry to be exhausted at 28% under GST as against benefit expense of 15% alongside excitement assessment of 1.5% to 110% beforehand
- The move to impose carnivals at the most elevated rate seems to liken the part with extravagance excitements like gambling clubs, wagering, race courses
- This move is neglecting the business’ part in making social framework and drawing in tourism for the nation