GST unfair

Mumbai, Jun 1

The Indian Association of Amusement Parks and Industries (IAAPI) today condemned high taxation rate of 28 per cent on amusement parks, at par with casinos, betting and race courses, and termed it as ‘unfair’ for the industry.

Ashok Goel, founder member of IAAPI, said that the recently announced Goods and Services Tax (GST) by the Government of India has put the very existence of India’s amusement theme park industry at peril with the imposition of a mammoth tax rate of 28 per cent.

He said, “Such high taxation rate puts a very big question mark on the sustenance of our industry which is already under substantial stress owing to the existing high tax rates and low margins. Moreover, categorizing us alongside casinos, betting and race courses is really unfortunate for an audience which caters to family entertainment and recreation. It is a social infrastructure, which provides outdoor entertainment to children and youth, who are otherwise glued to gadgets and the digital world. Amusement parks help encourage bonding with your near and dear ones and in most cases act as a stress-buster. Collectively, as a single voice of the industry, we would like to urge the government to treat our industry at par with hospitality and restaurants which fall in the GST slab of 12 per cent to 18 per cent.”

Globally, in markets where GST had been introduced, tourism rate had been kept half of the GST rate and in most cases, it was under 10 per cent, he pointed.

The GST rate in Australia was 10 per cent, Singapore-7 per cent, Japan-5 per cent, Malaysia-6 per cent, he informed and said this on one hand stimulated tourism and on the other hand created an economic multiplier effect on GDP, thereby creating business opportunities to multiple sectors like hospitality, food and beverage and transport among others. This move by the government has made the parks economically unviable, which might eventually lead to their closure, Mr Goel noted.

This kind of tax rate would place a significant burden on the industry, which has been reeling under the pressure of entertainment tax coupled with a service tax of 15 per cent, he said.

Furthermore categorizing the industry in the luxury tax bracket also seemed unfair, as amusement parks catered to family audience, he added.

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