After increasing bus fares, diesel and petrol prices, now the Congress administration of Karnataka has imposed a 2 per cent tax on OTT subscription fees and movie tickets. On 19th July, the Karnataka Cine and Cultural Activists (Welfare) Bill, 2024 was tabled in the assembly. The Karnataka Cine and Cultural Activists Social Security and Welfare Fund is a proposed government financial scheme intended to support the state’s cine and cultural activists.
As per the bill, a ‘Cine and Cultural Activists Welfare Cess’ will be levied in the state on movie tickets, subscription fees and associated establishment earnings. The administration has announced that the cess will be between one and two per cent. The rate will be updated every three years. The Karnataka Cine and Cultural Activists Welfare Board would be set up by the government, with Bengaluru serving as its headquarters and the Labour Minister functioning as its chairman, per the bill.
The govt intends to expand this cess to theatre productions held within the state, according to Labour Secretary Mohammad Mohsin’s statement. A welfare board consisting of seven members will be constituted for cultural activists and film industry workers as part of the bill. One-third of the board members will be nominated for a three-year term. The board wants to promote social security programs for film industry workers using the money raised from the cess.
“The cess will be levied at rates which will be notified by the government and shall not exceed 2 per cent but shall not be less than 1 per cent on cinema tickets, subscription fees, and all revenue generated from the related establishments,” stated the bill.
While cess on movie tickets will be collected from theatres, it is not sure how the cess on OTT subscriptions will be collected. Because OTT subscriptions are not state-specific and payments are made online. Officials from the labour department revealed that they are now figuring out how to collect the cess on OTT subscriptions.
The Karnataka Cine and Cultural Activists’ Welfare Board will receive the government-collected cess. Minister-in-charge, Department of Labour, Additional Chief Secretary/Principal Secretary/Secretary, Department of Labour, Labour Commissioner along with seventeen members appointed by the government including cine workers and others will be a part of the board.
The bill read, “Cine and cultural activists include any person employed in the cinema field as an artist (such as an actor, musician, or dancer) or in any skilled, unskilled, manual, supervisory, technical, or artistic role. This also includes individuals engaged in activities declared by the government for this Act. Cine and cultural activists recognised by government-approved academies, such as the Karnataka Chalanachithra Academy, Karnataka Nataka Academy, Karnataka Sangeetha Nruthya Academy, Karnataka Janapada Academy, Karnataka Lalithakala Academy, Karnataka Yakshagana Academy, and Karnataka Bayalata Academy, are covered under this bill.”
An estimated 2,355 people, including artists and technicians, are working in the film industry, according to the Karnataka Film Workers’ Artists’ Technicians’ Union. However, a large number of part-time technicians and artists might not be listed with any state organization. A distinct identity card will be issued to each enrolled member so they can make benefit claims. The method by which the cess will be applied to OTT subscriptions, which are normally administered via internet services devoid of physical addresses, is not entirely clear. Talks over whether or not OTT subscriptions would be included are still underway, according to Mohsin. It appears that the local film industry’s OTT productions are the main focus.
Meanwhile, the finance advisor to Karnataka Chief Minister Siddaramaiah, Basavaraj Rayareddy, on 11th July unveiled that the state’s lack of funding for development projects is a result of guarantee schemes. The crisis stemmed from the fact that large sums of money had to be put aside for the giveaways. “Many MLAs are demanding funds for development works in their constituencies, however, there is no money with the government. We are spending approximately Rs 65,000 crore on guarantee schemes. Since I am the financial advisor, I somehow managed to get the grant for lake development project. People want development. But believe me, there is absolutely no money. Since I am the financial advisor, I managed to get funds for the lake development project here,” he mentioned while addressing an event at Mangaluru village in Yelburga taluk in Koppal district.
