Tax-Free Flicks: What Makes a Movie Eligible for Exemption?

In a bid to make cinema more accessible, several state governments have recently declared a movie 'tax-free'. But what exactly qualifies a film to be exempted from tax? According to experts and industry insiders, a film is typically declared tax-free if it carries an inspirational or social message.

The current GST rate imposed on movies is 28%, but two slabs of 12% and 18% are introduced for tickets priced below ₹100 and above ₹100 respectively. When a film is declared tax-free, the state government gives up its share of the tax, while the Centre still gets its share. This results in lower ticket prices, making the movie more accessible to a wider audience.

Notable movies that have been declared tax-free in select states include Taare Zameen Par, Mary Kom, Dangal, and The Sabarmati Report, which has just become the latest fil to receive this exemption along with other notable titles such as The Kerala Story and The Kashmir Files. Other notable beneficiaries of tax exemptions include Richard Attenborough's Gandhi from 1982.

However, there are no specific guidelines to determine which films qualify for tax exemptions. Typically, state governments and the Centre tend to waive taxes for movies inspired by social messages or featuring inspirational figures.

In conclusion, the exemption from tax is largely aimed at making cinema more accessible to a wider audience while promoting valuable storytelling that resonates with the masses.