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Tag: Taxation

  • Eight years of GST: India’s landmark tax reform turns a corner

    Eight years of GST: India’s landmark tax reform turns a corner

    MUMBAI: Eight years after its midnight launch, the Goods and Services Tax (GST) stands as a defining milestone in India’s economic reform journey. Introduced by the Modi 1.0 government on 1 July 2017, GST replaced 17 indirect taxes and 13 cesses, creating a unified tax system aimed at transforming revenue collection and compliance mechanisms.

    From its inception, GST has aimed to simplify the tax landscape and improve compliance—especially for small and medium enterprises (SMEs). Prime Minister Narendra Modi recently reiterated this in a social media post, calling GST a “powerful engine” of economic growth and an exemplar of cooperative federalism, where states act as equal partners in market integration.

    GST revenues have seen consistent growth—from Rs 7.19 lakh crore in 2017–18 to Rs 22.08 lakh crore in 2024–25. Registrations have more than doubled, rising from 60 lakh to 1.51 crore active taxpayers. The government credits this to technology-led compliance features such as e-invoicing, auto-populated returns, AI-driven analytics, and e-way bills, which together have helped reduce fraud and encourage voluntary adherence.

    The media and marketing industry has also undergone a structural shift under GST. Earlier fragmented under multiple state-level service taxes, the sector now operates under a more uniform 18 per cent GST slab, enabling centralised billing and improving cash flow predictability for agencies and broadcasters. For the television industry, in particular, GST eliminated disparities between content producers and distributors across states, streamlining operations and reducing cascading taxes. However, smaller agencies have flagged concerns about delayed input credit refunds and compliance costs, prompting calls for more sector-specific easing.

    Leaders across industry reflected on GST’s journey. Anand Mahindra, chairman of Mahindra Group, called it “India awakening as a common market for the first time.” Vijay Shekhar Sharma, founder of Paytm, termed GST “the dawn of a new India.” Kiran Mazumdar-Shaw, executive chairperson of Biocon, described it as “transformational,” while also calling for further simplification.

    Despite progress, key issues remain. Over two lakh disputes are pending due to the delayed establishment of GST appellate tribunals. The presence of multiple tax slabs and inverted duty structures—particularly in textiles and fertilisers—continues to create inconsistencies. Petroleum products and real estate remain outside GST’s ambit, limiting its scope as a truly comprehensive indirect tax.

    Tax experts from PwC India advocate for rationalising the rate structure to three tiers and gradually bringing petroleum products under GST to remove economic distortions. The GST Council has indicated that such reforms are under active consideration. Plans to operationalise 31 appellate tribunals by December aim to address the litigation backlog.
     

  • Budget 2015: Futuristic and progressive, feels media industry

    Budget 2015: Futuristic and progressive, feels media industry

    MUMBAI: If Suresh Prabhu’s Rail Budget spelt out a pro – poor stanza, then Arun Jaitley has recited a pro-poor poetry while presenting the Union Budget.

     

    With burdens of expectations and aspirations, the Finance Minister started his presentation at 11 am on 28 February. As it is said ‘the morning shows the day,’ his initial sentences enlightened poor of the country. With pension and health insurance schemes, the government successfully managed to add smiles to the below middle class society. Jaitley’s pro-poor, pro-growth and pro-reform mantra followed throughout the budget. Sanitization, minority education, preservation of heritage sites, job creation and empowerment of youth were given supreme priority.

     

    Viacom18 Media group CEO and CII National Committee on Media & Entertainment chairman Sudhanshu Vats said, “Two words sum up the essence of Budget 2015: balance and clarity. Finance Minister Arun Jaitley walked the tightrope by staying away from big bang announcements that might have strained the fiscal position, while taking substantial steps on matters of tax, social security and public investment (especially in Infrastructure). On the reduction in corporate tax rates to 25 per cent, the 4-year implementation roadmap is a welcome addition. This is the clarity that the corporate sector needs so far as tax policy is concerned. While personal income tax slabs remain unchanged, higher exemptions are targeted towards savings and would add to retirement income in taxpayers’ wallets. ‘Wallets’ too will don a different connotation given the FM’s vision for a cashless society. The clarity on corporate tax road map is a welcome development for investments in the Indian M&E sector.”

     

    He further added, “The reduction in withholding tax rates (to 10 per cent) on royalty and FTS payments to non-residents has finally been granted. The increase in service tax is probably to bring the rate closer to the rates expected under the GST regime. In that context, the step is the proverbial bitter pill for our industry. I must compliment the FM for his announcement of social security schemes for the vulnerable sections of society as a vital cornerstone towards inclusive growth and development. All in all, this is a ‘Make in India’ budget that will truly ‘Make India’.”

     

    ZEEL CEO and MD Punit Goenka congratulating Jaitley said, “Indeed a futuristic and growth oriented Super Budget presented by Arun Jaitley! The Budget has certainly addressed the overall tax concerns and has portrayed a positive picture for the investors! It is certainly a Budget to remember for the Common Man, since it has remarkably addressed all the key aspects like housing, jobs & education! Congratulations Arun Jaitley for wonderfully addressing the nation’s concerns through the Budget 2015 & for setting some key goals for 2022!”

     

    Reduction of corporate tax, increase in service tax and abolition of wealth tax with a surcharge of two per cent for income over Rs 1 crore was the eyebrow raiser for the corporate industry. But the line that will be music to many industrialists was, “abhi permission lene me hi saalo beet jaate hain, project shuru bhi nahi hota” (it takes years to get the necessary permissions and the projects don’t take off), which signifies minister’s inclination towards establishing a business friendly environment. He also spoke about forming a pre existing regulatory mechanism to ensure fast and transparent business market.

     

    According to Reliance Broadcast Network CEO Tarun Katial, the budget is positive, realistic and progressive in nature. “The overall budget seems to be well thought of with a holistic approach and some key announcements for the service industry. The proposed reduction in corporate tax over the next four years is encouraging as it will result in higher investments, growth and more jobs creation. The move to increase the service tax however will put smaller advertisers under pressure and hamper advertising spends. The move on CSR is good and radio can be used effectively as a catalyst for social transformation in initiatives like Swachh Bharat, since radio can reach to the remotest of the corners where no other medium does because of literacy and cost issues, especially so with phase III and deeper reach. Overall a very good budget and I congratulate the Government for presenting us with a good futuristic budget.”

     

    The level of expectations and aspirations were visible in share market too. Both Sensex and Nifty soared before Jaitley’s presentation. The market was waiting for some big announcements and reduction of corporate tax was one of them. 

     

    The major outlines of the budget include:

     

    Policy Reforms

    · Create a universal social security system for all Indians

    · Commodities regulator to be marched with SEBI

    · New bankruptcy code in 2015/16

    · Promise to amend the RBI act this year and provide for a monetary policy committee

    · To set up public debt management agency

    · To raise visa-on-arrival facility to 150 countries from 43

     

    Taxation

    · To implement goods and services tax by April 2016

    · To increase service tax to 14 per cent

    · Reduction in corporate tax to 25 per cent from 30 over next four years

    · Wealth tax to be abolished, but a surcharge of two per cent for ‘Super Rich’ earning over Rs 1 crore

    · Plans to introduce direct tax regime that is internationally competitive on rates without exemptions

     

    Fiscal Deficit

    · Fiscal deficit seen at 3.9 per cent of GDP in 2015/16

    · Challenge of achieving fiscal target of 4.1 per cent of GDP

    · Commitment to meet medium term fiscal deficit target of three per cent of GDP

    · Current account deficit below 1.3 per cent of GDP

    · Need to keep fiscal discipline in mind despite need for higher investment

     

    Growth

    · GDP growth seen at between 8 – 8.5 per cent

    · Aiming double digit durable growth rate, achievable soon

     

    Inflation

    · Consumer inflation to remain close to five per cent by March, opening room for more monetary policy easing

    · Monetary policy framework agreement with the RBI clearly states objective of keeping inflation below sic per cent

     

    Investment

    · Propose to do away with different types of foreign investment and replace them with composite caps

    · To allow foreign investment in alternative investment funds

  • 2014: A year of improved subscriber numbers

    2014: A year of improved subscriber numbers

    The year 2014 has been better than the previous year, in terms of the share of numbers for all direct to home (DTH) players. Subscriber additions were higher and there was more stability in the overall industry. In terms of price discounting, people were more rational through the year. Overall, it has been a much better year than 2013.

    Increased subscriber numbers and ARPU

    Overall additions in subscribers, for all the DTH players, were higher in the magnitude of 25-30 per cent than the previous year.

    That apart, the churn came down substantially, not only for Dish TV, but for all the other DTH players as well.

    2014 also saw a rise in the Average Revenue Per User (ARPU). But there are still problems, since the whole cable TV system hasn’t stabilised and gross billing hasn’t been fully implemented. Though, we do see some encouraging signs, in terms of people getting down to doing that now.

    DTH has been able to take price increases through the year. There was a price increase which took place in April, at the magnitude of 8-9 per cent. But the big collection from the ground will happen only once cable TV gets its act together.

    Different people calculate ARPU differently. For example, Dish TV calculates it on subscriber revenue, whereas Airtel Digital TV, as per its published figures, looks at gross numbers, and so do others. So there is no common matrix being used across the industry for definition of ARPU. But having said that, at the consumer level, the consumer prices are in the average price range of Rs 250-275.

    Challenges in 2014

    One of the major challenges that we continue to present to both the state and central government is on the high level of taxation on DTH. Apart from the taxation element which we have been presenting, we are the only industry which is subject to service tax and entertainment tax. While we were hoping for some relief in the last budget, we didn’t get that, we hope we will get some relief in the coming year.

    Secondly, there is no clarity on the licence fee issue, even though the Telecom Regulatory Authority of India (TRAI) issued a recommendation, there has been no action on that front.

    So while we lived in continued uncertainty in 2014, we hope that the government will take some steps in 2015. People have invested more than Rs 25000 crore in the industry, so at least we have the right to know what the law of the land will be going forward.

    The new launch Zing

    It has been an extremely successful product in all the geographies we launched. The specific proposition that we had, which was regional first and targeting the entire product mix around consumption has clicked very well with the customers. So we are very pleased with the way things have come.

    Highs and lows of 2014

     For Dish TV, it has been a fairly stable year. We regained our share leadership for about last three to four quarters. We launched a significant and tactical product in Zing which has helped us capitalize on the phase III and IV areas. The high point has been that we have been able to, post the balance sheet adjustment that we did last year, been able to get back on the growth path, which is what we have always said and we achieved that in 2014.

    The low point is at two levels: At one level, the whole issue of taxation and licence fee kept dragging for the whole year. Secondly, we expected the cable TV and broadcaster system to stabilize the whole regime. The whole issue of getting proper addressability and customers to actually choose and compare products has still not happened.

    Delayed Digitisation

    First and foremost, the manner of digitisation needs to be addressed. What has happened in the first two phases is simply the change of pipe. This has not been supported by addressability and that is the reason there has been no or marginal change in the revenue flow.

     Until and unless these issues are addressed, a non-addressable digitisation is of no help to anybody, neither to the government nor the stakeholders. We hope that by the time they get down to it, we will have some better roadmap of how to achieve that.

     

    (These are purely personal views of Dish TV CEO R C Venkateish and indiantelevision.com does not necessarily subscribe to these views)

  • Zee Turner: Budget should stop double taxation from broadcasters
     

    NEW DELHI: Broadcasters have expressed the hope that the government will ease the taxation structure for the initial three to five years and introduces policies that promote domestic manufacturing of set top boxes because the high import duty and taxes like octroi and other taxes were acting as a bottleneck in smooth transition to digitalisation.

    Zee Turner CEO Arun Poddar told indiantelevision.com today that irrational rates were dissuading Indian entrepreneurs from investing in the production of STBs. He hoped the government would introduce policies that promote domestic manufacturing of STBs.

    Listing his expectations from Union Budget 2007-08 being presented on 28 February, Poddar appealed for doing away with double taxation from broadcasters. He said since media was part of the entertainment as well as a service industry, broadcasters were charged both entertainment tax and service tax.
     

    He said the entertainment industry was in the transition mode from analogue to digital and it was extremely imperative for the government to take steps that not only accelerate the process but also make this industry an interesting and appealing investment proposition for Indian manufacturers.

    Service tax remained one of the crucial and unresolved issues in the entertainment industry and should be sorted out in the forthcoming Union budget. While service tax is levied on the electronic media, the print media is exempted from any such taxation. This is despite the fact that both print and electronic fall under media and entertainment industry. There was therefore need to create a level playing field for all, and take measures to bring electronic at par with print media.
     

    “The 400,000 exemption limit from service tax has led to ‘appalling confusion and dissatisfaction’. While the last mile cable operators are able to take undue advantage of this exemption limit, multi system operators (MSOs) and broadcasters were being penalized,” Poddar said. The last mile cable operators conveniently avoid passing the service tax to MSOs by under declaring their subscriber base by almost 80 to 85 per cent. MSOs and broadcasters paid service tax but could not recover this from the last mile operators.

    He expressed the hope that the government would bring about clarity on how service tax should be charged or should waive the exemption limit completely.