Ad Agencies Vie For Rs 50 Crore Vds Promotion Pie

Heated brainstorming. Harried copywriters. Frantic rehearsals. And slick presentations. It could be any campaign by rival advertising agencies to bag a lucrative corporate account. Except that the prospective client in this case is the Income-Tax Department. And theres no product to be promoted, only a message.

The message, which is more or less that honesty is the best policy, is not a terribly original one either. But the agency that communicates it most effectively stands to make a lot of money an account worth Rs 50 crore, to be precise.

For that is the amount that the Income-Tax Department has allocated as its advertisement budget for promoting the voluntary disclosure scheme (VDS) proposed in the 1997-98 Finance Bill.

 

The campaign will essentially entail confidence-building measures, assuring assessees of adequate protection after the disclosures are made.

The promotional activity will not be confined to advertising alone. Taking a leaf from Hollywoods massive merchandising tome, the department also plans free distribution of T-shirts and coffee mugs emblazoned with appropriate slogans.

The department has decided not to utilise the services of its old faithful, the directorate of audio and visual publicity (DAVP). Instead, the account will be assigned to a private ad agency after considering presentations by several agencies.

Agencies that have already made presentations include Indias Top Two, Hindustan Thompson Associates (HTA) and Lintas. However, the contract will finally be awarded only after the successful passage of the budget, say sources.

Bhuvanendra Nigam, member (investigation), Central Board for Direct Taxes (CBDT), is believed to have been selected as the chairman of a special committee to be set up for implementing the scheme.

It is believed that Nigam, who is slated to retire on April 30, will be given an extension to oversee the execution of the scheme, which is expected to commence from June 1 and expire on December 31, 1997.

All chief commissioners of all zones in the country will be members of the committee, and direct field work will be carried out under the supervision of the directors in charge of investigation in each zone.

The scheme is aimed at encouraging tax offenders to declare their undisclosed income. Under the scheme, any amount disclosed either in cash, securities or assets, whether in India or abroad, will be taxed at the highest revised rate of tax. However, penalties and interest will be waived.

Immunity from any action under the Income-Tax, Wealth Tax and Foreign Exchange Regulations Acts will also be granted under the scheme.

Sources expect some administrative work to commence at least a week before the debate over the budget begins in Parliament.

The scheme, christened Voluntary Disclosure of Income and Wealth Scheme, 1997, is slated to come up for discussion once the Finance Bill is taken up for debate in Parliament.

The BJP has already expressed its vehement opposition to the scheme, alleging that it entails legalised conversion of black money into white. However, the proposal is expected to sail through Parliament, given its immense popularity with the business lobby.

The Income-Tax Department believes that about Rs 2,000 crore will flow into the Centres coffers as tax revenue through this scheme. Whether the scheme eventually succeeds remains to be seen, but helping unearth black money will certainly ensure that at least one ad agencys balance-sheet will be substantially in the black this fiscal.