Indian Service Tax
Video Tape Production Service
Effective
Date 16/07/2001.
Authority
Notification No. 4/2001-ST, dt. 9/7/2001 (for full text of Notification see under Broadcasting).
Rate of Service Tax
8% from 14/5/2003 (5% upto 13/5/2003). 10% from 10/9/2004 - Cess 2% of 10% = 0.2. Total ST = 10.2%.
Definitions
"video production agency"means any professional videographer or any commmercial concern engaged in the business of rendering services relating to video-tape production; [Section 65 (119)]
"video-tape production"means the process of any recording of any programme, event or function on a magnetic tape and includes editing thereof, in any manner; [Section65 (120)]
Taxable service
Video tape production service provided by a video production agency to a client.
Value of taxable service
Gross amount charged from the client, but cost of unexposed photographic film or unrecorded magnetic tape or such other storage devices, if any, sold to the client during the course of providing the service, shall not be included in the value of this taxable service.
Exemptions
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Reproduction of original master to make further copies of video-tape
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Individual videographer - Notfn." No. 7/2001-ST, dt. 9/7/2001
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Selling TV serial episodes to TV Channels - Cir. No. 78/8/2004-ST, dt. 23/3/2004.
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Film shooting
Person liable to pay
Video Production Agency.
Head of Account
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Main text of Departmental Circular/TN
As pre Section 65 (83)*, “video tape production” means the process of any recording of any programme, event or function on a magnetic tape and included editing thereof, in any ,manner. As per Section 65 (72) (zi), taxable service is any service providee to a client by any video-tape production agency in relation to video tape production in any manner.
It may been seen that the taxable service covers the service of serials, telefilms or any other programme meant for broadcasting. Also, the scope of taxable service covers any service in relation to video tape production in any manner. Thus facilitation activities, devices, providing technical persons for operating the recording devices or for any other activity in relation to video tape production are taxable. Similarly, editing, colouring, dubbing, printing titles and special effects, film processing etc., bya video producing agency will all come within the scope of this service. It is clarified that reproduction of original master to make further copies of a video-tape will not come within the purview of service tax.
Services provided by individual videographers has, however,been exempted vide notification No. 7/2001-ST, dated the 9thJuly, 2001. As such, the tax is payable by studios, shops and other establishments carrying on business of rendering of services in the field of videography.
Selling TV Serial episodes to TV channels – exempt
Cir.No. 78/08/2004-ST
Dated 23/3/2004
Sub:- Service Atax on the production of Television serials.
Representation have been reeived in the Board with regard to levy of service tax on the activities undertaken by the television serial producers, who either
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sell TV serial episodes to the TV channels, or
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allow such episodes to be telecasted by the channels in lieu of procurement of Free Commercial Time (FCT), which is sold by them to advertising agencies for showing advertisements.
It appears that in some jurisdiction service tax is being demanded on the services listed at ('i) under the category of Videotape Production Services, and in respect of services listed at ('ii') under the category of Advertisement Agency Services.
The issue has been examined. The taxable service i.e. "video tape production service" is on the process of recording of any programme, event or function on magnetic tapes (including editing thereof). The tax is therefore limited to the technical function of recording or editing what is recorded and not on the entire gamut of production of serials. In case the producer hires a videographer or an editor, the payment made for services would be taxable at the hands of such service providers. However, no tax is leviable on the producers for selling the serial to channel.
Similarly, in case of FCT, selling the time allotted to a producer does not fall within the purview of "advertisement service" since this activity is not connected to making, preparation, display or exhibition of advertisement. This is akin to providing space in a newspaper or magazine for publishing an advertisement and has nothing to do with actual presentation of the advertisement.
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