Service tax exemption: Budget a hit with Bollywood

“It will certainly boost the business of films… In India,there are just a handful of films which make good theatrical business. And beyond that,if the producer has to pay service tax,it just kills the producer. This (the exemption) will reduce the losses films make and result in overall growth,” he says.

Actor-producer Sanjay Suri is relieved too. “There are anyway so much costs involved in making a film and distributing it… any kind of exemption will help.”

The film industry was planning a nationwide shutdown to protest against the Central government’s decision to levy service tax.

Called by the Film Federation of India (FFI),the strike had been put off till the Budget Session after officials from the industry met Mukherjee.

The heads of production houses aren’t breathing easy yet,though. Vikram Malhotra,COO of Viacom18 that is producing some of the biggest movies this year,says: “This is just the beginning. This is clearly not the only thing that will regulate the Indian film industry.” Sid Jain,owner of IRock Entertainment,says: “I need to read the details carefully to see if it really reduces our net cost of production.”