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Help DTH industry appeals to FinMin forrelaxation on multi-layered taxation
#1
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Currently, the DTH operators pay the central
govt 10% (of annual revenue) in the form of
licence fee and 12.3% as service tax
With the change in mantle at the Ministry of
Information and Broadcasting, direct-to-home
operators in India hope they will finally get
some respite from the multi-layer taxation that
they are subject to as of now. On behalf of the
six private DTH players, Dish TV has appealed
to the finance minister Arun Jaitley and I&B
minister Prakash Javadekar seeking an audience
to discuss the issue.
In the past too, the industry has pointed out
the burden it faces due to the multi-layer
taxation. Currently, the DTH operators pay the
central government 10% (of annual revenue) in
the form of licence fee and 12.3% as service
tax. Additionally, they pay the individual state
government's entertainment tax, as prescribed
by them.
"In some states, like Uttar Pradesh, the
entertainment tax is as much as 33%. On a
pan-India level, each private DTH player pays
roughly 9% in entertainment tax. Adding this
to the license fee and service tax wepay, the
total comes to nearly 32%, which is very
high,"said R C Venkateish, CEO, Dish TV India.
He adds that DTH has brough ttransparency
and tax revenues to the government which was
impossibleto as certain and collect in the old
analog regime. Dish TV, along with other
members of the DTH Association of India have
appealed to the ministries and will be meeting
the respective ministers this week.
"The DTH players have collectively invested
nearly Rs 2,500 crore towards stablishing
systems and backend for the industry and the
multi-layered tax burden in preventing anyone
of the six operators from making any profits,"
said. Venkateish.
"Dish TV is taking the lead to appealto the
Honorable Finance Minister to provide relief
from the twin burden of entertainment tax and
and service tax. It appeals to allow abatement
in service tax to the extent of entertainment
tax paid or 60% of service tax whichever is
lower. The flawed taxation structure of this
industry has encumbered the growth of
thisotherwise promising industry," he adds.
Currently, there are seven DTH
serviceproviders in the country of which, six
are private including Dish TV,Airtel DTH,
Videocon d2h, Tata Sky, Relaince Digital TV
and SunDirect. The seventh player is DD Direct,
part of state run Doordarshan.Last year, the
Telecom Regulatory Authority of India (TRAI)
has come out with a recommendation that the
licence fess charged to DTH operators should
be reduced from 10% to 8% of annual
revenues. However, no step has been taken
towards this. "We will take this up with the
I&B minister as well. We are not using a
public spectrum and still are expected topay
such high license fees," said an executive from
another DTH operator on the condition of
anonymity.
The industry is hopeful that these
considerations will be included by the
ministries in the upcoming budget and the tax
burden will be lowered.
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