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KPMG calls for simpler tax for India’s media sector

Tax laws for India's media and entertainment industry need simplifying, according to global management consultants KPMG.

"The industry hopes for simplification of the onerous tax laws and resolution of some of the long standing tax controversies impacting this sector," Himanshi Parekh, partner, KPMG India, is quoted as saying in the Economic Times.

The levy of service tax and value added tax (VAT) on content copyright is, he said, "a major pain point for the industry".

The broadcasting sector is plagued with tax issues, he added, pointing in particular to the uncertainty around payments that have tax deduction at source (TDS), and higher withholding tax at 20% in the absence of a permanent account number.

"Issues surrounding potential levy of service tax as well as VAT [value added tax] on activation charges and recharge coupon vouchers has been haunting the direct to home (DTH) television industry," said Parekh.

Entertainment tax, levied at between 30-40%, on the exhibition of films is also a concern, KPMG believes.

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