Karnataka is in frequent headlines these days. The state once known for pioneering India’s IT industry is on the verge of losing it all. But, that’s a different issue. Now, a new tax is on the way for the film industry of Karnataka.
The Karnataka state government has proposed a new tax, called a “cess,” on cinema tickets and OTT subscription fees. This tax, which will be between 1% and 2%, is meant to support film and cultural workers. The exact rate will be decided by the government later.
This is coming under the Karnataka Cine and Cultural Workers (Welfare) Bill, 2024, which was introduced in the Assembly on Friday.
The bill will begin by setting up a seven-member welfare board to manage the funds collected from the cess. The work doesn’t end here. They are supposed to ensure support for social security schemes for film and cultural workers.
Labour Department Secretary Mohammad Mohsin mentioned that discussions are ongoing about whether OTT subscriptions, especially those for local film industry productions, will be included in the cess. He also pointed out that there is uncertainty about how the cess will be applied to OTT subscriptions, which are usually managed online without local addresses.
There are some OTT platforms dedicated to the Kannada film industry such as Nammaflix. We are not sure how the state government aims to differentiate between the OTT platforms that have a PAN India reach and those that are majorly popular only in Karnataka.
Many things need to be sorted out.
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