Kathmandu, August 19

The Kathmandu Metropolitan City (KMC) has directed cinema theatres in Kathmandu to pay applicable entertainment tax to the government within September 3.

The direction came as the cinema theatres under the jurisdiction of KMC have failed to pay entertainment tax to the government as required. There are 42 cinema theatres within KMC.

Issuing a notice today, KMC said that it would initiate legal action against those cinema theatres that fail to clear their entertainment tax dues within the given deadline.

As per the existing legal provision, cinema halls have to pay five per cent of each movie ticket price as entertainment tax to the government.

Though cinema theatres have been collecting this tax from customers on every movie ticket, they are reluctant to pay the tax to the government.

As per KMC, only four cinema theatres out of 42 theatres under its jurisdiction have paid entertainment tax to the government in the last fiscal year.

“As cinema theatres have been collecting money from customers on every movie ticket in the name of entertainment tax, they should deposit the collected amount in the government’s coffer,” said Naranidhi Neupane, chief of revenue department at KMC.

The government has been levying up to five per cent entertainment tax on cinema halls, video halls, exhibition halls and different other centres for recreation.

“We have repeatedly asked operators of cinema theatres to clear tax dues. However, they are not responding to KMC’s call,” said Neupane, adding that KMC will be obliged to initiate legal action if they fail to present themselves at KMC and clear tax dues within September 3.