Dileep Kumar
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MUMBAI: Delhiites can expect to dole out more cash for their weekly dose of entertainment courtesy the new budget presented by the Arvind Kejriwal led Aam Aadmi Party (AAP).
Under the new budget, while entertainment tax (ET) on cable TV and direct to home (DTH) in the national capital has gone up from the current Rs 20 to Rs 40, that for cinema halls has been hiked by 20-40 per cent. This, even as Maharashtra based cable operators, paying a hefty sum of Rs 45 as entertainment tax, are still fighting a case in the Bombay High Court for slashing the taxes, with little respite.
According to Delhi based cable operators, while there aren't any issues per se with increasing the entertainment tax, their grouse is that the government should have devised a way of collection from consumers before increasing the ET.
As for now, it is the local cable operator who collects the ET from consumers and then gives it to the multi system operator (MSO). The system sees a number of leakages and blame game. While LCOs lament that the customer does not pay ET, MSOs believe that the LCO fail to pass on the collected ET to them. Since the onus of finally submitting the ET collection to the government is on the MSO, not surprisingly they are held guilty more often than not.
While Delhi fell in phase I of DAS, where interconnect agreement should have been signed and billing started, thus protecting leakages, the same has yet not been achieved. Thus, increasing the ET by Rs 20 seems no less than a burden to both LCOs and MSOs.
"The government can increase the entertainment tax, but then what are the measures it has put in place to be able to facilitate collection," says Cable Operators Federation of India (COFI) president Roop Sharma.
Sharma believes that the government should give incentives to cable operators for collecting entertainment tax from consumers. “The LCOs are the biggest sufferers in the whole process as they face the task of extracting this additional amount from their customers,” she adds.
According to a Delhi based MSO, hiking entertainment tax is an unwelcome move.
“With the earlier tax system, the exact amount was not being collected and this resulted in the MSOs getting penalized. The LCOs will not be able to collect the extra money from the ground, which will mean that the MSOs will have to pay the remaining from their own pocket,” the MSO tells Indiantelevision.comon condition of anonymity.
The MSO is also of the opinion that while digitization was aimed at bringing in transparency, which ensured lesser leakages, hiking taxes and thus increasing the cable bill was unjustified.
DTH Operators Association of India president and Videocon d2h CEO Anil Khera said, “The recent announcement of doubling of entertainment tax on cable TV and DTH services made by the Aam Admi Party government seems unfair and illogical.
DTH as a platform is considered as critical to citizen’s right to information, news, education and entertainment. The sector is already saddled with high tax, where 33 per cent of revenues are taxed between the Centre and State. DTH operators that comprises Tata Sky, Dish TV, Airtel Digital TV, Videocon d2h, Sun Direct and Reliance Big TV, will have no choice but to hike their tariffs in Delhi
Read More:-http://www.indiantelevision.com/cable-tv/msos/dth-cable-ops-miffed-as-aap-hikes-entertainment-tax-in-delhi-150627
Under the new budget, while entertainment tax (ET) on cable TV and direct to home (DTH) in the national capital has gone up from the current Rs 20 to Rs 40, that for cinema halls has been hiked by 20-40 per cent. This, even as Maharashtra based cable operators, paying a hefty sum of Rs 45 as entertainment tax, are still fighting a case in the Bombay High Court for slashing the taxes, with little respite.
According to Delhi based cable operators, while there aren't any issues per se with increasing the entertainment tax, their grouse is that the government should have devised a way of collection from consumers before increasing the ET.
As for now, it is the local cable operator who collects the ET from consumers and then gives it to the multi system operator (MSO). The system sees a number of leakages and blame game. While LCOs lament that the customer does not pay ET, MSOs believe that the LCO fail to pass on the collected ET to them. Since the onus of finally submitting the ET collection to the government is on the MSO, not surprisingly they are held guilty more often than not.
While Delhi fell in phase I of DAS, where interconnect agreement should have been signed and billing started, thus protecting leakages, the same has yet not been achieved. Thus, increasing the ET by Rs 20 seems no less than a burden to both LCOs and MSOs.
"The government can increase the entertainment tax, but then what are the measures it has put in place to be able to facilitate collection," says Cable Operators Federation of India (COFI) president Roop Sharma.
Sharma believes that the government should give incentives to cable operators for collecting entertainment tax from consumers. “The LCOs are the biggest sufferers in the whole process as they face the task of extracting this additional amount from their customers,” she adds.
According to a Delhi based MSO, hiking entertainment tax is an unwelcome move.
“With the earlier tax system, the exact amount was not being collected and this resulted in the MSOs getting penalized. The LCOs will not be able to collect the extra money from the ground, which will mean that the MSOs will have to pay the remaining from their own pocket,” the MSO tells Indiantelevision.comon condition of anonymity.
The MSO is also of the opinion that while digitization was aimed at bringing in transparency, which ensured lesser leakages, hiking taxes and thus increasing the cable bill was unjustified.
DTH Operators Association of India president and Videocon d2h CEO Anil Khera said, “The recent announcement of doubling of entertainment tax on cable TV and DTH services made by the Aam Admi Party government seems unfair and illogical.
DTH as a platform is considered as critical to citizen’s right to information, news, education and entertainment. The sector is already saddled with high tax, where 33 per cent of revenues are taxed between the Centre and State. DTH operators that comprises Tata Sky, Dish TV, Airtel Digital TV, Videocon d2h, Sun Direct and Reliance Big TV, will have no choice but to hike their tariffs in Delhi
Read More:-http://www.indiantelevision.com/cable-tv/msos/dth-cable-ops-miffed-as-aap-hikes-entertainment-tax-in-delhi-150627
