GST Cut: What it Means for the Film Industry — Full Explanation

The government has announced a change in GST that affects movie tickets: tickets priced at or below ₹100 will see GST reduced from 12% to 5%, effective 22 September 2025. Below is a detailed, step-by-step explanation of the announcement, who benefits, the numerical impact, expert reactions and what it will (and will not) solve for India’s film industry.

What exactly was announced?

The GST Council approved a restructuring of certain tax slabs. For cinemas, the key change is:

Tickets priced ≤ ₹100: GST reduced from 12% → 5%.
Tickets priced > ₹100: remain under the higher slab (reported as 18% in most reliable media coverage).
The change comes into force on 22 September 2025.

Why this matters

The cut targets low-priced tickets that are common in single-screen theatres and Tier-2 / Tier-3 cities. In those markets many shows sell under ₹100 — so the cash price for everyday moviegoers will drop slightly. However, premium multiplex tickets, which generate a large share of industry revenue, are largely unaffected.

Digit-by-digit: How the math works (examples)

All calculations below show the ticket face price (RSP), GST amount and total amount paid by the customer.

Example 1 — Ticket ₹90

Old GST (12%): 90 × 0.12 = ₹10.80 → Total = ₹100.80
New GST (5%): 90 × 0.05 = ₹4.50 → Total = ₹94.50
Savings per ticket = ₹100.80 − ₹94.50 = ₹6.30

Example 2 — Ticket ₹100

Old GST (12%): 100 × 0.12 = ₹12.00 → Total = ₹112.00
New GST (5%): 100 × 0.05 = ₹5.00 → Total = ₹105.00
Savings per ticket = ₹7.00

Example 3 — Ticket ₹150 (typical multiplex)

If GST remains 18%: 150 × 0.18 = ₹27.00 → Total = ₹177.00 (no change)
Note: Some early reports showed conflicting slab tables; however, mainstream reporting and trade commentary indicate ₹150 tickets will continue to attract the higher slab (≈18%).

Who benefits — stakeholder breakdown

Single-screen theatres & smaller towns

These exhibitors are the primary beneficiaries. Most seats in these circuits sell below ₹100 — so the net effect can be a small but direct reduction in ticket price for local audiences, which exhibitors can use to attract more footfall.

Multiplexes & metro audiences

Limited to no direct benefit. Multiplex tickets commonly exceed ₹100; therefore, unless slabs are extended to higher price bands, metro and premium audiences will not see relief.

Producers & distributors

The impact on producers depends on how much of the tax saving exhibitors pass to consumers versus keep in margin. For big-budget films that rely on multiplex premiums and F&B revenue, the aggregate effect will be marginal.

Consumers

For price-sensitive moviegoers (families, students, regular local audiences), a ₹6–7 saving per ticket is meaningful. But a small per-ticket saving alone is unlikely to reverse the long-term trend of declining footfalls unless coupled with strong content and theatre experience.

Industry reaction

Exhibitors called the cut a “welcome but limited” relief.
Trade analysts said this is a positive signal, but the larger challenge remains weak footfalls driven by OTT competition and a shortage of consistent blockbuster content.
Multiplex associations had sought a wider relief (for example extending the lower slab to higher price bands) — which did not materialise in this notification.

Will this revive the industry?

Short answer: No — not by itself. The GST reduction is a targeted, supply-side incentive that reduces price slightly for value-sensitive segments. Real revival would require a combination of:

Better content pipelines (regular hits)
Improved theatre experience and modernization for single-screens
Broader incentives that also help multiplexes or F&B revenues

Risks & reporting inconsistencies

Some media lists and early reports carried inconsistent slab figures for higher price bands (confusion over whether any band saw an increased “de-merit” rate). The most consistent, reliable reading across government briefings and mainstream coverage is that the assured change is ≤ ₹100 → 5% from 22 Sept 2025. Always refer to the official CBIC notification / Gazette for definitive slab details.

Short FAQ

Q: When does the change take effect?

A: 22 September 2025. From that date tickets ≤ ₹100 attract 5% GST.

Q: Will my multiplex ticket get cheaper?

A: Most multiplex tickets (> ₹100) will not benefit unless the slab is extended — current reporting indicates higher-priced tickets remain in the higher GST slab.

Q: How much will I save?

A: For a ₹90 ticket, you save roughly ₹6.30. For a ₹100 ticket, about ₹7.00. Savings scale with the number of tickets purchased.

Conclusion

The GST cut for low-priced movie tickets is a targeted measure that provides immediate relief to single-screen theatres and price-sensitive audiences. It is a helpful policy move — but not a silver bullet. The theatre revival depends heavily on content, theatre modernization and broader measures that address premium-ticket revenue and customer experience.