Introduction: The Rising incomes, a growing population of young Indians and a greater willingness to spend on leisure have given a boost to the amusement industry. As per research firm ‘Insight Alpha’ there are about 120 amusement parks and 45 Family Entertainment Centres in India, generating estimated revenue of around 4000 crores and is expected to grow by 10% per annum in next couple of years. It is estimated that the total capital investment made in the amusement and theme park industry in India till date, is more than INR 40 billion (excluding investment on land).

Last year Wonderla became the first-ever an amusement park in India to go for an IPO amounting to Rs. 180 crores. Further, the organized players namely Nicco Parks and Zee group are also expanding their base.

Till now, what was seen as entertainment is now an opportunity. People, from varied cultural and professional interests are now turning towards investing and cashing on this opportunity. This has created enough noise to capture the Governments interest, leading to significant changes in the way taxes are levied on Amusement Industry.

Below, the have tried to put forth, few facts and figures about the current taxation scenario. Before I jump into the details, let me explain few basic terms:

Amusement Facility:

‘Amusement Facility’ has been defined in Section 65B (9) of the Act, ‘as a facility where fun or recreation is provided by means of rides, gaming devices or bowling alleys in amusement parks, amusement arcades, water parks, theme parks or such other places but does not include a place within such facility where other services are provided.

Entertainment events:

‘Entertainment events’ has been defined in section 65B(24) of the Act ‘as an event or a performance which is intended to provide recreation, pastime, fun or enjoyment, such as exhibition of cinematographic films, circus, concerts, sporting events, fairs, pageants, award functions, dance performances, musical performances, theatrical performances including cultural programs, drama, ballets or any such event or programme’.

Provisions before Finance Act 2015:

The activities of “Admission to entertainment events or Access to amusement facilities” have been kept in “Negative List of Services” u/s 66D of Finance Act, 1994. Thus, outside the ambit of Service tax.

Changes made through Finance Act 2015:

  • Service Tax shall be levied on the service provided by way of access to amusement facility providing fun or recreation by means of rides, gaming devices or bowling alleys in amusement parks, amusement arcades, water parks and theme parks.
  • Service tax to be levied on service by way of admission to entertainment event of concerts, pageants, musical performances concerts, award functions and sporting events other than the recognized sporting event, if the amount charged is more than ₹ 500 for right to admission to such an event.

Hence, based on the above amendment it is clear that, access to amusement park is taxed without any limit. Further, admission to entertainment events such as concerts, pageants, musical performances concerts, award functions and sporting events in excess of 500/- will be subject to service tax on full consideration.

Example: Service tax on entry to Music concert:

Situation 1:

Consideration: 400/-

Service tax @ 14%: Exempt from Service tax

Situation 2:

Consideration: 600/-

Service tax @ 14%: (600*14%) = 84/-

Authors Note:

The existing exemption, by way of the Negative List entry, to service by way of admission to entertainment event, namely, exhibition of cinematographic film, circus, recognized sporting event, dance, theatrical performance including drama and ballet shall be continued, through the route of exemption. For this purpose a new entry is being inserted in notification No. 25/12-ST.

Lastly, the Entertainment events or access to amusement facilities is a state subject covered under Entry 62 of List II of the Schedule VII of the Constitution (62. Taxes on luxuries, including taxes on entertainments, amusements, betting and gambling) and hence this amendment encroaches into the State Subject, which in the opinion of many professionals can be challenged.

So, next time you have plans to go to Wonderla, Snow world or ramoji film city or a live concert of Arjith Singh be ready to pay more.

The above changes are applicable from 01.06.2015

(Author is Working as Assistant Manager- Indirect Tax in a Chartered Accountant firm)

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  1. ramesh shinde says:

    My question is that if Performance with food & drinks is included in a event and charging by tickets that is including of all – Service tax & Entertainment at both will attract at a time on ticket price.

  2. Ashish Pratihast says:

    Dear Sir,

    Pls clarify,
    suppose Entry fees to a snow park is – 400 /-
    and after entry to the park Access to amusement facilities- Rs- 200/-

    Weather we have to pay Service tax on Net Basis or Individual basis as there is a cut off limit of 500/- for paying Tax.

  3. Pavan Jayaprakash says:

    Consideration is 8000/-, Service tax to be remitted on 8,000/- only.

    However, we have to prove that no additional non monetary benefit is going to customer.

  4. Shilpa says:


    Please clarify whether the onus lies on the service provider or recipient in these cases i.e. whether these services fall under RCM???

  5. NS says:


    If an amusement park is providing an offer – ‘ buy 2 get 1 free ‘, on what amount should service tax be charged.
    Let the entry pass value be Rs 4000.
    By paying 8000 Rs, customer gets 3 passes.
    Service tax is charged on 8000 Rs or 12000 Rs (being the cost of 3 passes) ?

  6. Pavan Jayaprakash says:

    Dear Vishrut Shah,

    The above taxable service ‘Amusement Park & Entertainment event’ is not in the list of 119 services listed along with accounting codes meant for registration.

    This being the case at the time of registration ‘Other taxable services [services other than the 119 listed]’ needs to be selected at the time of registration.

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May 2021