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Cinema halls in Kathmandu fail to pay entertainment tax

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More than 40 million rupees due

Kathmandu, September 4, 2016: Cinema halls in Kathmandu have been found to have failed to pay entertainment tax each year. Kathmandu Metropolitan City Office (MCO) has informed that more than 40 million rupees have to be collected from cinema halls.

Altogether 12 cinema halls are in operation in Kathmandu. But none of these halls have paid entertainment tax.

Jaya Nepal Hall, Kumari Hall, City Centre, Ashtanarayan Hall, Ganga Hall, Gopikrishna Hall, CTC Mall, among others, have failed to pay entertainment tax.

Legal provision dictates that any hall showing foreign films has to pay two percent of each ticket price as entertainment tax to the government.

Even though the MCO Office warned these halls time and again to pay all overdue taxes, they have turned deaf ear to it, MCO’s Tax Section Chief Dhruba Kumar Kafle said.

“We have sent them letters and also run advertisements in national media asking to pay the taxes but they have not done so,” he told.

Section 141 of Local Self-governance Act-1999 had provided for levying entertainment tax to approved cinema halls, video halls, exhibition halls and other centres for recreation.

Cinema halls in Kathmandu play Hindi and English movies and they have to pay taxes. Those halls which play only Nepali movies do not have to pay the taxes, MCO informs. Such tax has been imposed to promote Nepali cinema.

MCO estimates that around 724 shows of foreign films take place in cinema halls in Kathmandu. With average of 150 rupees as ticket price, around 2.5 million rupees are raised as entertainment tax. Even if those halls add entertainment tax to ticket price, they themselves have not paid that tax money to the government.

Nepal Film Producers’ Association Chairperson Raj Kumar Rai says that the government should collect taxes from cinema halls on time after conducting a multi-party discussion.

Local Self-governance Act has provided for closing cinema houses and selling the property in bidding if they fail to pay entertainment tax

By Subash Bhatta