What Budget Means For Entertainment Industry
Abolishing the Foreign Investment Promotion Board will allow foreign studios to invest in Indian market
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The most important expectation that the media and entertainment industry had from the Union Budget 2017 was to boost the digital ecosystem.
With the unveiling of the new budget on Wednesday, many in the media industry believe that the revolution of digital space, print and television is proceeding well.
Many believe the tax rates are affecting revenues generated in the industry along with double taxes paid for broadcasting on television channels.
This meant that the cost of production and broadcasting had gone higher but after the implementation of the GST (Goods and Services Tax) the industry sees a lot of uniformity in tax payments.
Digital media continues to increase business and since digitization has been the government's top priority, this segment will also explore ways to improve its connections to the most rural regions of the country.
Ashwin Gidwani, MD and producer of AGP World, said: "The budget is progressive and will give India a boost in the long run. It also aims at India being compliant and digitally enhanced economy. It will also help small businesses progress and contribute to entrepreneurship in our country. We still don't know what the fine print says about the Entertainment Economy and in particular exorbitant Entertainment Tax which discourages companies like ours to promote and produce international talent in our country. Nonetheless I am very happy about the demonetization exercise as we brought Stomp to India and saw great success despite the cash crunch."
Stakeholders in the market were very keen on hearing the announcements of this year's Union Budget related to media and entertainment and with the uniformity of taxes, conditions like cost of production and increased remuneration can be managed.
Many media and entertainment organizations that operate on a small scale will witness a slow growth rate but will benefit from uniformity of taxes.
The post-demonetization era has made it imperative for some major changes to be introduced for businesses to sustain and also pave the path for new entrants.
While Finance Minister Arun Jaitley didn't say much about the media and entertainment industry, he did talk about indirect plans that could help boost it at the same time.
Problems like piracy will be dealt with by setting up quick action teams that will take action to advance cyber security and this move can go a long way in curbing piracy of movies.
Digital India is transforming the country into a mobile-first economy which will create advancements in digital transactions and attract more consumers to subscribe to content related to media and entertainment.
This step will boost the respective industries on digital platforms. Abolishing the Foreign Investment Promotion Board will allow foreign studios to invest in the Indian market and allow more job opportunities in the entertainment industry along with international cinema to the audiences.
"A few things that will have an impact on the entertainment industry are the setting up of Anti-Piracy action teams, abolishing the Foreign Investment Promotion Board and the implication of GST (in terms of lower taxes)," said Amar Pandit, co-founder and CFO of Happydemic.