Tax on cable operators stays

Cable TV charges are set to rise following imposition of service tax from September 10 onwards on multi-system operators (MSOs), industry players said today.

Cable TV MSOs, who were exempt from service tax till last financial year, have been brought into the tax net from September 10, 2004, as per a government communique.

"MSOs are liable to pay service tax with effect from September 10, 2004, the day the Finance Bill was enacted. The government, however, has provided that in respect of any service, which has been subject to service tax from September 10, any payment received prior to this date will not be taxed," an official release said clarifying the government's stance on MSOs.

MSOs said this would lead to a hike in cable TV charges.

"The charges are expected to go up by 10.5 per cent in view of this government notification," head of the MSO Alliance Grouping, Ashok Mansukhani, said.

Mansukhani, who is also the executive vice-president of Hinduja TMT, said the operators would again take up the matter with the government.