The Kerala Story tax-free in these states. Movie tickets cheaper now

Uttar Pradesh Chief Minister Yogi Adityanath on Tuesday announced that his government will declare the movie ‘The Kerala Story’ tax-free in the state. The Kerala Story ‘tax-free’ in these states. Movie tickets cheaper now.

“‘The Kerala Story’ will be made tax-free in Uttar Pradesh,” the chief minister said in a tweet in Hindi.  The Kerala Story has been declared as ‘tax-free’ in Uttar Pradesh and Madhya Pradesh. On Monday, Uttar Pradesh Chief Minister Yogi Adityanath took to Twitter to announce that the controversial movie will be declared as ‘tax-free’ in the state.

A similar announcement was made by Madhya Pradesh chief minister Shivraj Singh Chouhan last week who said, “the film should be watched by all” and hence the state is making the movie tax-free. But does that mean that tickets are free?

There is no set rule for this. State governments may decide whether or not to give up their claim to tax income on a film-to-film basis, based on their evaluation of the relevance of the topics addressed in the film. Socially significant topics may be considered, along with promoting tourism or production in a specific region.

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No, tickets are not free, but they are available at a discounted price. Before the introduction of the Goods and Services Tax (GST) in 2017, each state in India had its own entertainment tax rate. After the implementation of GST, initially, a 28% tax rate was imposed on movie tickets.

However, later, two different tax slabs were introduced: 12% GST on tickets priced below Rs 100 and 18% GST on tickets priced above Rs 100. The revenue generated from this tax is distributed equally between the federal and state governments.

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Now, when a state declares a film ‘tax-free’, it exempts only half of the entertainment tax, which would be either 9% or 6%, depending on the ticket price. This means that while movie tickets may still be cheaper in tax-free states, the discount is no longer as significant as it used to be.