Budget is mixed for M&E industry
by EVENTFAQS Bureau | Corporate/Brand Marketing | March 19, 2012
Finance Minister Pranab Mukherjee on March 16 witnessed the unveiling of the budget for 2012-13. While some benefit was provided in terms of the direct taxes, it was the indirect taxes that grabbed the headlines. The hike in indirect taxes from service tax to excise duty is expected to translate into expensive goods and services.
However, the media and entertainment industry received some good news, even as service tax was hiked from 10 per cent to 12 per cent. The latest budget places "admission to entertainment events or access to amusement facilities" in the negative list, which comprises of other services that are exempt from the service tax.
The Finance Bill defines an entertainment event as an event or a performance which is intended to provide recreation, pastime, fun or enjoyment, by way of exhibition of cinematographic film, circus, concerts, sporting event, pageants, award functions, dance, musical or theatrical performances including drama, ballets or any such event or programme.
Meanwhile, the film industry received a service tax exemption in connection with copyright relating to cinematography. However, copyright relating to sound recording will continue to be taxed.
On the advertising front, the cost of advertising through radio and television is expected to become a little more expensive with the hike in service tax. The selling of space or time slots for advertisements, other than advertisements broadcast by radio or television, have been exempted from the hiked service tax.