Karnataka High Court strikes down 2% movie ticket cess levy

The High Court of Karnataka has invalidated the state government's decision to impose a 2 per cent cess on movie ticket sales, dealing a setback to efforts to establish a dedicated welfare fund for cinema and cultural sector workers.

The cess was designed to generate revenue for a social security and welfare scheme aimed at providing benefits to registered cine and cultural activists operating in Karnataka. The state had framed the levy as a mechanism to support those working in the entertainment and cultural industries.

The High Court's decision to quash the cess order removes the financial mechanism the state government had put in place for the welfare initiative. The ruling highlights judicial scrutiny of how state governments finance sectoral welfare programs and the conditions under which such levies can be imposed.

The judgment is likely to prompt the state to explore alternative funding mechanisms for supporting cine and cultural workers, or to revisit the legislative framework governing such cess collections. The decision reflects broader legal questions around the imposition of industry-specific levies and their constitutional validity.