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UP govt turns down proposal to revive defunct cinema halls as multiplexes

Uttar Pradesh government has mooted the revival of defunct single screen cinemas in the state by converting them into multiplexes.

The government is mulling to allow the owners of these defunct cinema halls, especially in smaller towns, to demolish the structure and develop multiplex complexes in their places.

Most of these defunct cinemas are located in prime locations in the respective towns and have commercial potential of combining entertainment with retail shops.

“The smaller towns lack quality shopping centres and showrooms. These defunct halls could be converted into multiplex complex, including both cinema screens and shops,” then UP minister of state for entertainment tax Tej Narain Pandey alias Pawan Pandey had told Business Standard .

He informed the proposal had already been sent to chief minister Akhilesh Yadav for approval. He has also directed officials to prepare a proposal for reducing additional levy on the telecast of local channels through cable TV network.

The idea is to increasing entertainment tax (ET) revenue also by reviving the defunct halls and helping medium entrepreneurs establish themselves

The government is considering offering grant to such entrepreneurs, who agree to convert their cinemas into multiplex having 300 or more seats spanning 1-2 screens.

Around the year 2000, there were almost 1,000 standalone cinema halls in UP, but their number has dwindled to about 450 now in the backdrop of growing popularity of multiplexes.

Of the functional halls, almost 350 are said to be on the verge of closure due to shrinking margins. Only those standalone halls, which screen latest films are in good financial health and these number around 100 in UP. The rest are slowly turning sick.

The exhibitors have long been seeking government support for the existing cinemas lest they meet the same fate.

Meanwhile, the government is targetting Rs 460 crore in entertainment tax (ET) during 2014-15.

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