With the recently announced Union Budget 2016 having little in store for the Media and Entertainment Industry, the Indian Broadcasting Foundation has raised concerns about the neglect of the M&E reforms.
Commenting on the Union Budget 2016, Girish Srivastava, the Secretary-General of the Foundation, said, “On behalf of the Indian Broadcasting Foundation, we thank the Hon'ble Finance Minister for presenting an inclusive and well-rounded budget, which will not only help the Indian economy at large but also provide an opportunity to all in becoming part of the overall growth process.”
On the specific issues of the broadcasting sector, he added, “We are happy to note that FM has addressed some of the concerns on the tax and policy matters, however the industry at large, remains disappointed on not getting the attention on some key issues such as carry forward of losses, in case of amalgamation or merger for service industry under the industrial undertaking under Section 72 A of the Income Tax Act, 1961. It is also unfortunate that Media and Entertainment industry, which has been playing a critical role in the digital initiative of the government, is being denied this benefit whereas other service sectors like Software, Telecom etc are availing these benefits”.
Another point that broadcasters had raised in their pre-Budget memorandum was on the tax withholding of transponder hire charges in which the sector had appealed for the alignment of the definition of royalty in DTAAs in line with the amended Finance Act 2012.
In the current Economic Survey, having acknowledged the significance of the ongoing digitization efforts and in turn Media and Entertainment Industry generating large scale revenue and employment, it seems that the budget inadvertently omits the long- term pending demand of grant of infrastructure status to the sector.
During the budget speech, FM has stated that most of the recommendations made by Justice Easwar Committee on simplification of procedures and related issues shall be accepted in due course. “IBF will take up the issues as above with the Finance Ministry in its post budget consultations” added Srivastava.