Film associations, exhibitors to go on strike on Thursday

New Delhi, Feb 21: Film Federation of India, a body of cinema associations and exhibitors across the country, has called for a one-day strike on February 23 demanding withdrawal of service tax on the film industry.

The federation claimed that as a result of the one-day strike, over 9,000 standalone movie theatres will remain shut. Multiplexes, however, will not be a part of the strike. The Film Federation of India (FFI) is taking the step after its meeting with Finance Minister Pranab Mukherjee earlier this week over the roll back of 10.3 per cent service tax failed to yield a favourable response.

As per FFI estimates, the number of screens in the country is over 10,000, of which about 900 are in multiplexes.

"The Indian film industry is already in deep trouble because of the various taxes imposed on it, and service tax only increases the heavy burden," FFI President Vinod Lamba told reporters here. He, however, did not comment on the financial impact of the strike.

"Introduced in 2010, the proposal is to charge service tax at each stage of the film going from the producer to the distributor to the exhibitor. Since that has not been paid, we have started receiving notices and that is why we want the government to look into the issue," Lamba said.

Lamba further said: "We want to bring it to the notice of the government that while 1,200 films are made in India every year, only a handful are successful. What the industry needs is concession and not additional taxes."

He added that passing the burden of the tax onto consumers will lead to raising of ticket prices, which are already high. Also, if the service tax is imposed, cost of making films will shoot up, he said.

"This (10.3 per cent) is not a small percentage. The budget of many films would be hit. We hope the government understands this," Lamba said.

PTI