Shahrukh Khan on Tuesday asked the Centre to remove Value Added Tax (VAT) and service tax on the entertainment industry.
MUMBAI: Shahrukh Khan on Tuesday asked the Centre to remove Value Added Tax (VAT) and service tax on the entertainment industry and sought the conferment of de-facto industry status on it so that it can earn certain tax incentives.
It has become necessary to bring in entertainment industry under the "concurrent list" so that it can be governed by Central rules and enjoy tax concessions announced by the latter from time to time, Khan said in a statement.
At present, the entire entertainment and film industry comes under state governments jurisdiction as a result of which, it has not been able to enjoy the already conferred dejure industry status on it.
Shahrukh Khan would release a study on the entertainment industry this evening highlighting the need for the removal of VAT and service tax.
The study, The Entertainment & Media Hub, is done by Associated Chambers of Commerce and Industry of India (Assocham).
Retaining the industry in the state government list deprives the tax concessions given by the Centre, Assocham said in its study.
According to the Assocham study, the media and entertainment sector would cross a turnover of Rs 1 lakh crore by 2011-12 from Rs 44,000 crore now.
The turnover of the television industry would grow by 22 per cent to Rs 51,900 crore by 2011-12 from Rs 19,100 crore, it said.
The turnover in the television industry would largely be driven by subscription revenue than advertisement revenue.
Subscription revenue would be a key growth driver for the industry as pay TV homes would increase from 71 million to over 100 million in four years, it said.
Assocham has asked for the enactment of Optic Disc Law to combat piracy, as such a law has been introduced in Malaysia, Hong Kong and the results have been encouraging, it said.
The government has set up five groups on piracy, taxation and custom duties, exports of films, promotion, development and marketing for films.
As per the Finance Act of 2007, the Central Excise department has issued notices for recovery of service tax from the industry in cases of renting, leasing, letting immovable properties, Assocham pointed out.
As the film industry is burdened with various types of taxes and fee imposed by state governments, the Centre should exempt transactions between producers and distributors, Assocham said.
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