Hyderabad: Prasads Multiplex near Tank bund in Hyderabad had something to worry about after reports emerged that they had received a notice along with Mahesh Babu's AMB Theatres for failing to adhere to GST Norms. But there's a twist to the story contrary to reports doing the the rounds.
It appears, Prasads has not been fined by the GST Anti-Profiteering wing for avoiding the GST Reduction to Movie Goers. The Management of Prasads released a statement to a local daily stating the same.
“After the GST rate on cinemas was reduced from 28 percent to 18, GST officials visited our office and inquired whether or not we had reduced the price in line with the anti-profiteering provision of the GST law. We explained to them that the admission rates to cinemas are controlled by the state government. The pre-GST rate of entertainment tax was 15 percent for Telugu movies and 20 percent for other language movies. The average rate used to work out to around 17 percent,” said Ramesh Prasad, chairman and managing director, Prasads, responding to a report in the local daily on February 9, while explaining the problems that theatres faced.
“With the implementation of the GST, the rate on cinema tickets went up to 28 percent. Theatres were not allowed by the state government to increase the ticket price in line with the increased rate of tax,” Prasad said. All theatres absorbed this increased tax for 18 months.
He quipped how they had not reduced admission rates after the GST rates were revised. “The present rate of 18 percent was almost the same as 17 percent earlier and there was no profit. It only reduced the additional tax burden on us and hence no reduction in the rate of admission is warranted.” Prasad said.