Union Budget 2017-18: How the entertainment industry could benefit from provisions
Going into the announcement of the Union Budget 2017-18 by Finance Minister Arun Jaitley, the film industry had a bunch of expectations. There is a sense in the entertainment/media industry of being overlooked time and again in previous budgets, so expectations were high that this one would address key concerns.
InUth spoke with filmmakers, distributors and producers to figure out what expectations the industry had from the Union Budget.
Broadly, greater investment in infrastructure, tax rebates and incentives, measures to combat piracy, and regularisation of entertainment tax all over the country by making it part of the GST was what the industry was hoping for.
A Financial Express report noted that the industry was also hoping for more flexible tax deadlines.
"Unlike other industries where employees can expect a salary deposit on the first of the month, in the film industry, often people only reap the rewards of their projects months after it has been released. Some small screen producers have (also) complained that monthly taxes need to be revised because payments are often delayed in the television business," the report concluded.
While there were not too many references to the entertainment industry in this Union Budget, India.com offered a quick lowdown on the provisions that offer some reason to cheer:
1. The quick action teams proposed by Arun Jaitley, to look into cyber security infractions, would also help in countering film piracy, an issue that proved especially troublesome in 2016 when every major film — from Udta Punjab to Kabali and even Raees were available for illegal downloads in entirety at the same time as their theatrical release.
2. Abolishing the Foreign Investment Promotion Board would induce more foreign studios to invest in India.
3. With online payments and digital transactions getting a boost, it is expected that the film industry will also be able to avoid losses of the kind that occurred in the immediate aftermath of the demonetisation drive.
4. Moreover, it was felt that the boost for digital India would aid in greater broadband penetration, creating greater opportunity for consumption of entertainment online, and on mobile phones.
Lastly, with GST implemented for the entertainment and events industry, it was felt there would be greater transparency in transactions for consumers.
Mazhar Nadiadwala, of Dome Entertainment Pvt Ltd (of the Dome @NSCI, where major live events are staged in Mumbai) said, "GST has been implemented on the entertainment and events industry and this will unify the indirect tax administration in India and help the country in two ways: Firstly, it will be easier for the consumers to understand and secondly, it will ease doing business. Also, application of GST will result in transparency in the transactions. Under GST, service tax or state tax will be available as a credit which will reduce overall costs and eliminate dual levies of service tax and VAT on transactions. However, every coin has two sides — at one end where we have advantages of GST, on the other end, certain businesses will face initial challenges, especially the ones who use traditional methods for transactions."
"GST will be of great advantage for the consumers as now they will enjoy transparency in terms of transactions they will do while buying tickets for live events, concerts, films, etc," Nadiadwala said.
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Updated Date: Feb 01, 2017 14:55:44 IST