Why movie tickets and live shows may soon get costlier in Bengaluru

• Bengaluru may impose entertainment tax via Greater Bengaluru Authority
• Ticket prices for movies and shows could rise if tax is approved
• Proposed tax may yield Rs 300 crore yearly for city corporations

Did our AI summary help?

Residents of Bengaluru may soon have to shell out more for movies, television entertainment and live shows, with the Fifth State Finance Commission recommending the introduction of an entertainment tax and fee across the city under the proposed Greater Bengaluru Authority (GBA).

According to The Hindu, the commission, in its report, has suggested that the newly formed city corporations operating under the GBA framework levy an entertainment fee on both ticketed and ticketless events, including television entertainment. The recommendation draws its mandate from the Greater Bengaluru Governance (GBG) Act, 2024, which empowers civic bodies to impose such charges.

According to estimates cited by the panel from the GBA, the proposed levy could generate approximately Rs 300 crore annually from the Bengaluru metropolitan area. The recommendation indicates that the authority has already worked out financial projections, although it remains unclear whether the individual corporations will adopt the measure.

The proposal comes at a time when the city's civic administration is undergoing a significant overhaul. The Bruhat Bengaluru Mahanagara Palike (BBMP) has recently been decentralised into five separate city corporations, all functioning under the umbrella of the Greater Bengaluru Authority. While this restructuring aims to enhance local governance and transparency, it has also exposed a substantial revenue gap.

The state government has stepped in with temporary relief, increasing Bengaluru's annual development grant from Rs 3,000 crore to Rs 7,000 crore. Nevertheless, officials maintain that the city's long-term financial sustainability hinges on the new corporations generating their own steady revenue streams through measures such as entertainment tax and enhanced taxation systems.

If the state government accepts the commission's recommendation and gives the green signal to the GBA, ticket prices for films and other entertainment avenues in Bengaluru could rise. The additional revenue reportedly will help the newly formed civic bodies address their financial challenges.

However, it remains to be seen how the corporations interpret the term "entertainment" and what kinds of shows or events they bring under its ambit. The Hindu reported that the committee noted the GBG Act, 2024, gives corporations the leverage to levy an entertainment fee on ticketed, ticketless and television entertainment.