CTMA against imposition of 10% licence fee on TV sets

New Delhi, June 5 (UNI) Expressing shock at the government plan to introduce a levy of 10 per cent licence fee on the purchase price of each TV set, Consumer Electronics and TV Manufactures Association (CETMA) today said the industry will go into recession if the government does not reduce indirect taxation, which at present is about 35 per cent.

Speaking to mediapersons here, CETMA President Anoop Kumar said, ''Levying of the licence fee will increase the tax to about 50 per cent as compared to the internal taxes in China, about 15 per cent, and Thailand, about 7 per cent, and make products from these countries much cheaper than domestic products''.

He added that while the demand for domestic products will decrease in comparison to the products from countries like China and Thailand, the share of grey market will increase resulting in the decrease of revenue for the government.

Mr Gulu Mirchandrani of the CETMA also pointed out that while the government is planning to introduce this tax to provide financial help to Prasar Bharati, the taxes already levied are average customs duty for inputs, about 6 to 8 per cent, excise duty, 16 per cent, central sales tax, 4 per cent and state VAT, 12.5 per cent.

He said the Television industry which provides employment to lakhs of skilled, semi-skilled and unskilled workers is facing difficult times due to low growth and global competition.

''The Colour TV set is included in the early harvest scheme of the Free Trade Agreement with Thailand. The import duty on TV sets from Thailand would become zero from September 1, 2006. There is zero import duty on all inputs of TV sets. Thailand makes about 17 million TVs of which 15 million are exported, while India makes 10 million of which only 1 million are exported at present. If the levy is imposed, many small TV manufacturing units will be forced to close down due to decline in demand rendering people unemployed,'' he added.

He also said that imposition of this levy will make television costlier by 15 per cent and unaffordable for the rural masses who constitute 60 per cent of the buyers.

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