Economic Survey 2014: Cable digitisaton to increase tax collection manifold

NEW DELHI: Both the Centre and state governments are set to benefit from the digitisation of cable television in India as it would lead to manifold increase in tax collection, says the Economic Survey for 2013-14.

"Preliminary data from the state governments show that there is already two to three fold increase in entertainment tax collections," said the Survey tabled by Finance Minister Arun Jaitley in Parliament today.

It is estimated that state governments and the Government of India stand to gain significantly, as the transparency in the subscriber base through digitisation would lead to manifold increase in the tax collection, the survey added.

The government has set a deadline of December 31, 2014 to completely digitise cable TV delivery in India and switch off the analogue mode that has been in service for a long time.

According to the survey, digitisation is also creating an opportunity for the domestic electronics industry to produce set-top-boxes (STB) required for it and generate employment opportunities.

"There is a good opportunity for local manufacturing of STBs, leading to employment generation," it added.

In the first two phases of digitisation drives in the metros and 36 cities, including state capitals, more than three crore STBs have been installed.

The other mediums of cable TV viewing such as direct-to- home (DTH) is adding one million customers every year, it said, adding the government has also allowed two operators to provide services through headend-in-the-sky (HITS) system.

The effect of digitisation is also visible on the film exhibition, where 95 of the big screens are now digitalised and the sector is "poised for buoyant growth in the long run".

The survey said media and entertainment industry, which includes mediums such as TV, radio, cinema, print, music and animation, have experienced 'unprecedented growth' in the last two decades and are expected to touch Rs 1,78,600 crore by 2018.