Karnataka Set to Impose 2% Cess on Movie Tickets, OTT Subscriptions; BJP Reacts

Bengaluru: After Petrol-Diesel, milk and other essential commodities, the Siddaramaiah-led Karnataka government is expected to impose 2 per cent cess on cinema tickets and Over-The-Top (OTT) subscription fees, in a bid to 'support cinema and cultural artists'.  This fee will fund social security benefits such as ESI and PF for cine artists and cultural performers, under the Labour Ministry’s Karnataka Cine and Cultural Activists (Welfare) Bill of 2024.  

Karnataka Cine and Cultural Activists (Welfare) Bill 2024 

The Karnataka Cine and Cultural Activists (Welfare) Bill, 2024 was tabled in the assembly on July 19. To support film and cultural activists throughout the state, the bill suggests that the government create a fund known as "The Karnataka Cine and Cultural Activists Social Security and Welfare Fund."  

As per this bill, a 'Cine and Cultural Activists Welfare Cess' will be charged in the state on movie tickets, subscription fees, and associated establishment revenue. As announced by the administration, the cess will be between one and two per cent. Every three years, the rate will be adjusted. 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," according to the bill accessed. 

Labour department officials said they are now working on the modalities of how the cess on OTT subscriptions can be collected. The cess imposed collected by the government will be transferred to the Karnataka Cine and Cultural Activists'. The board will include members such as the Minister-in-charge, Department of Labour, Additional Chief Secretary/Principal Secretary/Secretary, Department of Labour, Labour Commissioner, and 17 other members appointed by the government, including cine workers and others.

"Anyone working in the film industry as an artist (actor, singer, dancer, etc.) or in any manual, supervisory, technical, artistic, or unskilled capacity is considered a cine and cultural activist. This also applies to anyone who is involved in activities that the government has declared in connection with this Act," the bill said. 

It added, "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."

BJP Lambasts Karnataka Government

Meanwhile, R Ashoka, the leader of the opposition in the Karnataka Assembly, lambasted the state government's action, saying they were imposing this fee because they were short on money.  

“The cost of everything is going up, including gasoline and diesel. They have also imposed taxes on OTT subscriptions and movie theatres. This administration has devolved into a pauper government. Thus, there isn't any money. They are making the money because of this”, Ashoka stated.