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The proposal of a 10 per cent tax on marriage halls and convention centres is bound to upset budgets of those planning to tie the knot

It calls for a bit of vicious swearing before exchanging vows or tying the knot. Chief minister D V Sadananda Gowda played party-pooper by announcing a 10% luxury tax on marriage halls. With the marriage season just round the corner, it is certain to push up costs, already driven up the wall by inflation and the Central government’s excise duties.

What’s more, Gowda, for the first time, has brought temporary structures operating as marriage halls in the tax net. Luxuries of any sort for any event including exhibitions, fashion shows and auto expos conducted in seminar halls, convention centres or even temporary structures such those erected at the Palace grounds, would be taxed. And although Gowda has proposed a 10% tax, in effect customers would end
up paying 22%.
 
“Until now, customers had to pay only service tax of 12%. Now, it will almost double with the addition of the 10% luxury tax,” said a senior commercial tax department officer.
 
Although those owning temporary structures had to pay service tax, many did not bother. Now, customers engaging a marriage hall which commands a rent of Rs three lakh for a function, would have to cough up Rs 66,000 more towards tax (10% luxury tax and 12% service tax).
 
“This has upset the apple cart,” said Sriranga S, who hoped to clinch a deal for a temporary hall at the Palace grounds for a marriage in May. “I was looking for something cheaper than conventional halls, but even this is no longer an affordable option.”
 
However, the commercial taxes department says it’s a good move. Following a raid at the Palace Grounds last year, officials claim they had found the exchequer suffered a loss of Rs 18 crore as events and marriages conducted at the grounds were not taxed.
 
“Temporary structures, which never paid luxury taxes, can no longer claim immunity,” said Subodh Yadav, additional commissioner of commercial taxes.