Service tax increased from 12.36% to 14%. The Education Cess and Secondary and Higher Education Cess shall be subsumed in the revised rate of Service Tax.
GST to be implemented from April 2016.
Corporate tax reduced from 30% to 25% over the next four years, starting from next financial year. Budget 2015: Complete Coverage
Budget 2015: Complete Coverage
General Anti Avoidance Rule (GAAR) to be deferred by two years.
100% deduction for contributions, other than by way of CSR contribution, to Swachh Bharat Kosh and Clean Ganga Fund.
Enabling provision to levy Swachh Bharat cess at a rate of 2% or less on all or certain services, if need arises.
For companies, for financial year 2015-2016, additional surcharge called the “Education Cess on income-tax” and “Secondary and Higher Education Cess on income-tax” shall continue to be levied at the rate of 2% and 1%, respectively, on the amount of tax computed, inclusive of surcharge (wherever applicable), in all cases. No marginal relief shall be available in respect of such Cess.
Service tax to be levied on the service provided by way of access to amusement facility such as rides, bowling alleys, amusement arcades, water parks, theme parks, etc. Budget 2015: Complete Coverage
Service Tax to be levied on service by way of admission to entertainment event of concerts, non-recognized sporting events, pageants, music concerts, award functions, if the amount charged is more than Rs 500 for right to admission to such an event.
Industry Expectations
Deduction of tax at source under Section 194H on the “15% agency commission”
Withholding tax on royalty/ fees for technical services (FTS) payable to nonresidents
Budget 2015: Complete Coverage
Rationalization of Indirect taxes.
Reduction of import duty on set top boxes.
Getting Infra Status to cable DTH industry
Promote manufacturing of STBs in India under the Make in India initiative
Tax Exemptions for Radio Broadcasting
Exemption of import duty on capital equipment for radio broadcasting
Service tax exemption on services of performing artists
Exemption of service tax on Digital Cinema services
Export benefits to post production services under service tax legislation
Reversal of Cenvat credit under Rule 6(3) for any film content distributor
Reversal of CENVAT Credit for non-realization of export proceeds
Benefit under section 80-IB of Income Tax Act, 1961 ('IT Act') should be extended to multiplexes set-up after March 2005 as well.
Reduction of prescribed time limit under Rule 9A and 9B
A clear roadmap with regards GST implementation.
Budget Impact
Increase in service tax will be very negative to industry. However, this is expected to be passed on to consumers. There will be rise in ticket prices at Multiplex, MSO/DTH/Cable TV will see rise in package prices etc.
Cut in corporate tax rate from 30% to 25% to benefit. This will help companies in rise in net profit and EPS.
Service tax to be levied on the service like bowling alleys will have a minor impact on diversified entertainment players such as PVR.
Stock to watch
Dish TV, Den Network, Hathway Cable, PVR, Zee Entertainment, ENIL
Outlook
Budget was mostly neutral for the Media & Entertainment sector, except for the increase in service tax rate.
Easier access to loans, skill development to boost education
Former separatist Sajjad Lone takes oath as J&K minister
Mufti Mohammad Sayeed sworn-in as J-K chief minister
Decoding Budget with the Chief Economic Adviser
ATF price hiked by 8.2%; non-subsidised LPG to cost Rs 5 more