GST Evasion of Rupees 20 Crore by Malayalam Cinema Actors and Distributors 

Eight renowned Malayalam actors and a few film distributors are facing legal action for evading payment of the Goods and Services Tax to the tune of about 20 crore.

The state GST intelligence wing, which faced these actors with comments made by the makers and distributors of their films over the last few years, has assessed the tax evasion by the actors to be around Rs. 8 crore.

A young popular actor committed the single highest tax evasion, believed to be worth roughly Rs. 4 crore. The distributors were responsible for roughly 12.5 crore in tax evasion. According to authorities, the largest tax evasion was done by a distributor headquartered in Thiruvananthapuram, who was found guilty of dodging tax to the tune of Rs. 4 crore.

The GST regime applies to the revenue made by those in the film industry, including performers and technicians. Actors’ earnings from playing in movies and commercials, stage shows, appearances on various programmes, product endorsements, and becoming brand ambassadors are all taxable. According to sources, the sector is subject to an 18% tax net.

During the inquiry into the distributors, the actors’ tax evasion was discovered. Actors were required to acknowledge receipt of remuneration from producers and distributors, which had to be shown in the latter’s yearly tax accounts. The actors’ refusal to accept the compensation received, on the other hand, had put the producers and distributors in hot water. There were also rumors’ that some of the actors’ compensation was paid using unexplained money. According to insiders, some 30 top producers and distributors who were under investigation by the department spilled the beans.

Despite the fact that tax evaders were ordered to pay the tax, just Rs. 50 lakh was deposited as tax. According to reports, once the formal letters are delivered to the defaulters, they will be obliged to pay a fine of up to 100% of the taxable amount and face prosecution.