Doordarshan (DD) has joined the satellite channels in asking the advertisers and agencies to bear the cost of the 5 per cent service tax on advertising to be paid to the government. Ad campaigns of clients, who fail to pay the service tax, will not be aired on Doordrashan channels from the first of September.
The commercial service department of Doordarshan has sent a circular to this effect to all the accredited agencies as well as the Advertising Agencies Association of India (AAAI).
The circular states that from September 1, Doordarshan will only accept contracts or release orders for telecast of programmes and commercial spots with an additional provision of five per cent tax to be borne by the marketing agency, the advertising agency or the client. It adds that the release orders that do not make provision for the 5 per cent service tax will not be entertained and, therefore, those spots will not be aired.
Earlier, the Indian Broadcasting Foundation, the body of the private satellite channels, had similarly notified its advertisers. The government introduced five per cent service tax on advertising in the 2001 budget.
The total size of television advertising is close to Rs 3,500 crore.
