KARACHI, Sept 14: With the closure of Chandni Cinema on University Road, which entertained cinema-goers for more than a decade, the number of cinema-houses in the city has come down to 37.

People associated with the cinema industry say that in the early 1980s there were at least 110 cinema-houses in the city. They said VCR, dish antenna and cable have been instrumental in weaning people away from the cinema.

Industry sources said the loss suffered by the cash-strapped film industry the previous year had been to the tune of Rs150 million.

They said in 2002 at least 62 Urdu, Punjabi and Pushto films were released in the southern circuit, comprising Sindh and Balochistan.

The break-up of these 62 movies was as follows: 19 Urdu films, 26 Punjabi films and 17 Pushto films.

The Sindh government has introduced a spate of measures to revitalize the ailing cinema industry. On July 1, 2001, it abolished 55 per cent entertainment tax on the daily revenue of cinema owners. It devised a fixed-rate taxation system based on the classification of the cinemas of the city into three categories.

Under the new fixed-rate taxation plan, A-Category cinemas (AC and where new films are released first) pay Rs2,000 per day. The B-Category cinemas (AC but where new films are released afterwards) pay Rs1,000 per day. The C-Category cinemas (non-AC) pay Rs500 per day.

Cinema owners, however, maintain that the Sindh government gave the much-needed tax relief only when it became apparent that a large number of cinemas would be closed.

Zulfiqar Ramzi, a local cinema owner, told Dawn that the government was alarmed at the rate it was losing its own revenue obtained from cinema owners.

When asked why cinema owners have not passed on tax relief to cinema-goers, he said that the relief has been offered to cinema owners. If there had been no tax relief, a large number of cinema-houses would have closed down, he said.

Mr Ramzi said the number of cinema-goers had come down in a big way in recent years. He added that if good movies were made, which would bring more people to cinemas, the cinema owners of the city would definitely bring down ticket prices.

Experts say in terms of the entertainment tax paid by the cinema owners previously, the current fixed-rate tax comes merely to 10-15 per cent of the earnings. They add that after having received such a massive tax relief, the cinema owners should have brought down the prices of tickets.

Sources in the Sindh excise department said the tax relief offered by the government was costing it 50 per cent of the revenue it had been getting previously from cinema owners.