The government has proposed revising the method of calculating Value Added Tax (VAT) on cinema ticket sales to ensure a fairer and more equitable tax system within Sri Lanka's film industry.
President Anura Kumara Dissanayake delivering the 2027 Budget speech said, under the proposed changes, VAT liability for film producers, distributors, the National Film Corporation and cinema hall operators will be calculated based on the share of cinema ticket revenue received or allocated to each party at the respective stage of the distribution and exhibition process.
The proposed revision aims to move away from calculating VAT on the full value of a cinema ticket and instead apply the tax based on the actual revenue share attributable to each stakeholder in the film industry.
