Amusement parks pay less tax, LSGs lose Rs 2 crore
Panchayats have favoured amusement parks by bracketing them in a lower assessment category.
Thiruvananthapuram: Local bodies seem too lenient on amusement parks. Two years ago, it was Veegaland that was charged a low entertainment tax by Athiyannoor Panchayat in Ernakulam district. Now, it has been found that six more amusement parks, in six different panchayats, are charged a lower tax than they are obliged to pay. Panchayats have favoured amusement parks by bracketing them in a lower assessment category.
The Comptroller and Auditor General’s scrutiny of the records of six amusement parks for the period from 2011-12 to 2015-16 revealed that the entertainment tax (ET) was fixed without considering the actual structures, buildings and area. This resulted in short assessment of ET which led to loss of revenue of Rs 2.07 crore to the LSGIs.
The amusement parks that have been found cornering the benefits are: Vismaya Infotainment Centre (Anthoor Municipality, Kannur), Flora Fantasia Amusement Park (Moorkanad panchayat, Malappuram), Fantasy Amusement Park (Malampuzha Panch-ayat, Palakkad), Silsila Amusement Park (Thrikkalangode Panc-hayat, Malappuram), Dream World Water Park (Pariyaram panchayat, Kannur), Happy Land Amusements and Resorts (P) Ltd. (Manickal panchayat, Thiruvananthapuram).
Each park is given a particular category, which is based on the amount invested and the area utilized for the park excluding the parking area and other unutilized/vacant area. Vismaya Park, the largest in the list, should have paid Rs 50 lakh as ET. But it had been paying just Rs 25 lakh.
The proprietor of an amusement park will have to pay ET as fixed by the local body. The ET levied on amusement parks is governed by the Kerala Local Author-ities Entertainments Tax Act (ET Act), 1961. According to the Act, an amusement park proprietor will have to pay an annual ET fixed by the local authority within the range of rates mentioned in the Act.
Dream World Water Park, however, had obtained stay orders from the High Court. In the case of Happy Land, the proprietor had appealed to Manickal panchayat to reduce its ET. However, the panchayat agreed to the plea, reducing it from Rs 25 lakh to Rs 10 lakh, without getting the mandatory approval from the state government.