Better streamlining of taxes is the need of the hour- Harindra Singh, Percept
As everyone remains glued to the Union Budget 2017 developments, possibilities that the live events and entertainment sector will once again be sidelined continue to mount. We speak with Harindra Singh, founder of Percept, the organizers of Sunburn and one of the larger event companies in India, to know his thoughts and expectations from the budget.
Live Events are a major tourism booster with proven track records globally and in India. The High Entertainment Tax levied on the Events & Entertainment industry that showcases our talent and skills to the world as also brings inbound tourism mars growth opportunities. Various States in India are currently trying to promote event based tourism and in this scenario it is essential that the tax structures are simplified and made uniform across States.
A better streamlining of taxes levied is the need of the hour. Currently multiple taxes are levied on ticket and sponsorship revenues for a live event including Entertainment Tax ranging from 15% - 33% across various states + 15% service tax. VAT on Food and Liquor sales again range from 12% to 22% and in some states. VAT on the liquor sales on one-day license is as high as 50%. GST is supposed to take care of all this but currently there is no clear picture emerging on the same. Implementation of the GST will be a welcome move – however, the government will need to ease the transitional process to ensure a complete and uniform business reform.
Reduction in entertainment taxes can translate into event companies passing on the benefit to consumers, thereby bringing down ticket costs. Also given the high entertainment taxes by different states of India on EMC events, entry to these events should be excluded from the Service Tax levied- the cost benefit passed on to consumers will generate greater ticket sales and drive audience attendance.
The Government must incentivize the BTL industry through a focused, well defined plan aimed at long term Infrastructure improvement, digital penetration and growth, SOPS, content creation and strong IPR protection by the Law.
A single window of clearance for obtaining licenses, permissions etc. will help speed up and professionalize the entire process, ease operations, and reduce overall costs for event companies.
More concessional rates must be provided for taxation on foreign artists, performers & talents, so as to enable event companies and international artists to collaborate more seamlessly and proactively across borders. Tax Holidays should be provided for those who do set up business here. This will generate huge employment and give a much needed boost to the entertainment industry.
Lesser Excise Duties on Entertainment Access Devices will help drive consumer sales of these products and further help the BTL industry in multiplying reach, impact and revenue of their ground events.
* Harindra Singh is the founder and MD of Percept Entertainment Management Company. The views and opinions expressed in this article are solely those of the authors.
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