GST: Taxation process for the advertising agencies may get complicated
Advertisers feel that with Goods and Services Tax (GST), the taxation process for the industry will become more complex, but the benefits will outweigh the disadvantages
The taxation process for the advertising agencies can get complicated with the implementation of a new tax regime under GST. Some even believe that the service industry can come under inflationary pressures and that it may actually make things much more complicated, particularly for advertising agencies operating in multi states because there will be a Central GST and State GST, which may increase the complexity rather than ease it.
The Goods and Services Tax (GST) regime is just a few months away and the debate around its impact on various sectors is getting shrill again. Under the GST regime, the entire concept of taxing services will get changed. Seen as the biggest tax reform in India, GST will subsume most of the indirect taxes.

According to Saumin Shah, CFO, Hungama Digital Media Entertainment, the implementation of a new tax order will benefit businesses across sectors and lead to more ad spends. “The expected growth in India’s GDP by over 8% on the back of efficiencies coming out of GST roll out will lead to increase in advertising spends, with a greater pie for digital advertising. Businesses across sectors will be benefited on account of a single levy and better claim of Input tax credits, which may be ploughed back into advertising. Digital advertising will benefit the most in the overall advertising space as it continues to grow exponentially with massive increase in consumers on digital platforms,” he said.

While the overall ad spends will continue to grow after GST gets implemented, in-film and in-cinema advertising may face a challenging time due to continued high tax rates. The Finance Ministry, in a statement, has stated that services by way of admission to entertainment events or cinematography films in cinema theatres will attract 28% GST with effect from July 1.

Speaking about the GST announcement, Rahul Puri, MD of Mukta Arts said, “It is disappointing to see that the exhibition business will see no reduction in entertainment tax. I think the industry had hoped that a lower taxation rate would spur more investment into screens to really boost the industry. Sadly, I think the government has seen the business of a Bahubali and decided perhaps that films can be a lucrative revenue stream. Whereas the consistent tax rate is a good initiative and theatres in the North and in the very important state of Maharashtra may be happier with a slight reduction, overall it’s a disappointment.”

“The advertisement sector will be subject to higher tax, which will move from the current 15% to 18% under the GST regime, leading to brands ending up paying more. GST has its own complexities for businesses operating in multi-states, as there will be Central and State GST. Further, online matching of sales and purchases filed by the clients and vendors will make it operationally more complex. However, the benefits will outweigh the disadvantages,” added Shah.
It’s not just the advertisers who are getting ready for the new tax system. Major FMCG companies are also changing production strategies and offering discounts as they brace for the new tax system. Most of them see GST as a step that will benefit the economy and the industry in the long run. A research report by Motilal Oswal Financial Services said with the implementation of GST, many companies in the FMCG sector will likely gain as a result of the potential shift from the unorganised to the organised segment, which will have a positive impact on the advertising sector.

Speaking about the impact of GST on FMCG and advertising sectors, Harish Bijoor, Brand Expert and Founder, Harish Bijoor Consults stated, “The impact of GST on FMCG is a positive one. It is a move from complexity to simplicity. A much needed one. Finally it is here! Well-nigh! As for advertising, clients will end up spending more with the regime of tax moving from 15% to 18%. Fortunately for the category, it is not on the demerits list. Wonder how long it will take for advertising to move to the highest category of all, with cess added. Hopefully, never. Overall, I do believe that GST is great for the country and the economy at large. If the economy does well, advertising will do well as well.”
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
E4M Our strategy is to target younger audiences through Sports: Rajiv Dubey, Dabur
The Head of Media at Dabur India spoke exclusively to exchange4media on the World Cup, associating with Indian Idol, the company’s digital spending and much more
With quirky campaigns, memes and moment marketing, timed with the ongoing World Cup and particularly the India-Pakistan matches, Dabur India has got considerable consumer attention for its popular brands – Red Paste, Cool King Hair Oil, Chyawanprash, Dabur Vita and the recently launched Bae Fresh Gel toothpaste.
The 140-year-old company is going big on key sporting events, World Television Premiere (WTP) movies and reality shows. It is now gearing up to become the title sponsor of popular talent show ‘Indian Idol’ on Sony TV for the first time, shared Rajiv Dubey, who leads the media strategy at Dabur.
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
Swapan Seth's new book 'COOL' is out
The book is a reflection of the author's 'eclectic taste across categories'
Advertising professional and art collector Swapan Seth has announced the launch of his new book COOL. The book is described as "a ready reckoner to the hip and the happening, of the known and the very unknown."
The book is a reflection of the author's "eclectic taste across categories: from boltholes to exotic hideaways."
COOL has been published by Simon & Schuster India and is available on Amazon.
Seth is an ad veteran with a long and illustrious career in the industry. He became the youngest-ever Creative Director at Clarion at age 24. He was VP at 26 at Trikaya Grey. Two years later, he started his agency Equus.
He writes for publications such as The Economic Times, Hindustan Times and India Today. This is his second book and he has previously published THIS IS ALL I HAVE TO SAY.
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
Disney Star signs 9 sponsors for Asia Cup PAK
Charged by Thums Up, Nerolac Paint+, Amazon Pay, Jindal Panther, My11Circle, MRF, Samsung Galaxy Z Flip5, Wild Stone and Thums Up come on board
e4m Staff Disney Star has signed nine broadcast and digital streaming sponsors for the upcoming Asia Cup.
Charged by Thums Up, Nerolac Paint+, Amazon Pay, Jindal Panther, My11Circle, MRF, Samsung Galaxy Z Flip5, Wild Stone and Thums Up have come on board for the upcoming tournament.
As reported earlier by exchange4media, Disney Star has sought Rs 26 crore for the co-presenting sponsorship on TV and Rs 30 crore for Disney+ Hotstar.
According to industry sources, the associate sponsorship on Star Sports has been priced at Rs 19.66 crore, whereas for the ‘powered by’ sponsorship on Disney+ Hotstar, the broadcaster is seeking Rs 18 crore.
As per the information available with exchange4media, Disney+ Hotstar has three sponsorship tiers-- co-presenting (Rs 30 crore), powered by (Rs 18 crore) and associate sponsorship (Rs 12 crore). The broadcaster is offering an estimated reach of 120-140 million for co-presenting sponsors, 90-100 million for powered by and 60-70 million for associate sponsorship.
A spot buy for 10 seconds has been priced at Rs 25 lakh for the India vs Pakistan matches, while for the non-India matches, the ad rate for 10 second is Rs 2.3 lakh. The India matches plus the final for ODIs has been priced at Rs 17 lakh per 10 seconds.
Asia Cup is scheduled to be held from 30 August, 2023, to September 17, 2023.
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
Sorted 360 wins creative & social media mandate of Reliance Mall
The agency will manage offline and online campaigns for Reliance Mall
Sorted 360, an integrated creative and social media agency, has won the mandate to providing brand solutions for Reliance Malls across India.
“Sorted 360 is set to enhance Reliance Malls' market presence with their unparalleled creative prowess and strategic thinking,” read a press release.
“Sorted 360's commitment to pushing the boundaries of creative communication aligns perfectly with Reliance Malls' ethos. With a pan-India presence spanning across 19 cities and growing, Reliance Malls has consistently captivated customers by offering an array of Reliance brands and third-party fashion & lifestyle brands. The mall has established an unparalleled connection with its patrons through superior quality, a remarkable value proposition, and an unmatched shopping experience,” it read further.
"We are thrilled to welcome Sorted 360 as our trusted partner in advancing our brand presence across the nation," said the Head of Marketing at Relaice Malls. "Their proven expertise in retail, shopping center management, and innovative creative strategies make them the perfect fit for our vision."
"Partnering with Reliance Malls is a testament to our commitment to shaping extraordinary brand experiences," remarked Prerana Anatharam, Co-founder of Sorted 360. "We are excited to leverage our strategic and creative acumen to further elevate Reliance Malls as the epitome of convenience, choice, and excellence."
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
test
test
test
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
test
test
test
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp
KlugKlug onboards Hemang Mehta as Country Manager for Indias
Mehta was most recently Head of Agency Relationships at Network 18 Media & Investments
KlugKlug has appointed Hemang Mehta as its Country Manager for India.
Mehta will play a pivotal role in driving KlugKlug's growth and expansion within the Indian market and be responsible for Sales & GTM Strategy
Prior to that, he has also represented organisations like Exponential (now VDX.tv), India Today Digital and Rediff.com. His expertise spans various domains including digital media sales, mobile marketing, media planning, and buying, social media marketing, and more.
Hemang Mehta expressed his enthusiasm about joining KlugKlug, saying, "I am thrilled to be a part of KlugKlug, a forward-thinking platform that is reshaping the influencer marketing landscape. As much as I look forward to collaborating with the exuberant team at KlugKlug, I am super excited to interact with the brands to deliver powerful data-backed Influencer solutions that will guarantee business outcomes."
Commenting on the appointment, Kalyan Kumar, Co-Founder and CEO of KlugKlug, stated, "We are excited to welcome Hemang Mehta to our team as the Country Manager for India. His extensive experience in digital media sales and marketing will be instrumental in driving our efforts to provide influencer marketing solutions to our clients. We believe Hemang's leadership will be key in scaling our operations and expanding our reach within the Indian market."
Read more news about (internet advertising India, internet advertising, advertising India, digital advertising India, media advertising India)
For more updates, be socially connected with us onInstagram, LinkedIn, Twitter, Facebook Youtube & Whatsapp








Share