A Goods and Services Tax of 18% on Indian performing arts has triggered protests among artistes and producers across the country, but artists in Maharashtra are particularly in a state of despair.
Before the GST regime was introduced on July 1, Indian classical music, dance and theatre in Maharashtra were exempt from the state’s 25% entertainment tax. However, all these forms of Indian performing arts are now under the GST net, with a levy of 18% on show tickets priced more than Rs 250.
While this will significantly raise the rates of tickets, artists are particularly anxious about their personal tax liabilities. Under GST, businesses and service providers drawing a turnover more than Rs 20 lakh are required to register and file returns, but performing artists fear they will now have to register under GST and file multiple returns a month even if they are not earning Rs 20 lakh a year.
Moreover, like cinema theatre owners in Tamil Nadu, Maharashtra’s artists and arts producers are worried about the state government imposing an additional entertainment tax over and above the GST.
“Maharashtra was a progressive state in which theatre was not taxed unless foreign artists were involved,” said Kaizaad Kotwal, founder of the theatre company Poor-Box Productions. “Now the cost of art has gone up, but will audiences be inclined to pay beyond a certain threshold?”
‘Theatre groups barely survive’
In Mumbai, where theatre and performance arts tickets are typically priced between Rs 300 and Rs 500, levying 18% GST on tickets above Rs 250 would be a burden for audiences, and a possible drop in footfalls would hurt artists and producers.
Arun Kakade, founder of the well-known Marathi theatre group Awishkar, has already signed a collective appeal by regional theatre groups urging Finance Minister Arun Jaitley to reconsider the 18% GST on performing arts. Meanwhile, Kakade claims that the groups have found a temporary solution to the problem. “We have all reduced the price of our tickets from Rs 300 and more to below Rs 250, so that we can avoid paying GST till we get a response from the Finance Minister,” said Kakde. “We are hopeful, but if our appeal is rejected, then we will have to figure out ways to agitate further.”
According to Kunal Kapoor, director of the iconic Prithvi Theatre in Mumbai, theatre groups and artists barely manage to survive in an industry that runs on passion. “GST is going to make it very hard for theatre groups to start up and survive,” he said.
Filing returns
Life is likely to be even more challenging for performing artists earning more than Rs 20 lakh annually. They will be levied with 18% GST and will have to file returns at least three times a month.
“As a theatre owner, I will have to bear an additional monthly expense to hire an accountant to file these returns,” said Kunal Kapoor. “Artists don’t have the capacity for this, and even those who are not making Rs 20 lakh a year might have to register under GST and file zero returns, to show that they have not earned Rs 20 lakh. This will be an added burden for actors, directors, set designers and other workers in the industry.”
Many artists are not yet clear whether they are expected to register under GST, but any theatre group that uses e-commerce websites like Bookmyshow to sell tickets online will have to register.
While theatre groups and producers are struggling to understand the nuances of GST, they are also dealing with the anxiety of additional entertainment tax. “States have been given the power to add taxes in addition to GST, so tomorrow Maharashtra might slap entertainment tax worth 20% or more above the GST on tickets,” said Kotwal, who describes GST for performing arts as a draconian policy. “In essence that would kill off the arts.”
‘Is a theatre ticket a good or a service?’
At the heart of their disgruntlement, performance artistes believe it is unfair for the state to tax artists so heavily in the first place. Indian classical arts and small venues need to be encouraged and incentivised, not burdened with such taxes, they claim.
“How is a theatre ticket either a good or a service?” said Kotwal. “Everything cannot be valued on the basis of the revenue it could bring to the state, particularly the arts.”
According to Shashi Vyas, director of Pancham Nishad, an arts company in Mumbai that curates Indian classical music and dance shows, artists themselves have been taxed as services, which is illogical. “Art is an inevitable part of human life, meant for the enrichment of the human being,” said Vyas. “Artists are not providing service.”
