Find A Place For The Artist In The Budget

The rightful representation of artists, musicians, writers and creative contributors could be seen in the list of Padma awards on the eve of the Republic Day. This was followed by the Prime Minister's statement at the inauguration of the XIVth World Book Fair on February 5 that books `enlarge and expand our horizon' and is a source of intellectual inspiration to `enlighten the society'. This perhaps underscores the need for relief in real terms to this group in the forthcoming budget.

The reasons are not far to seek. It is indeed ironical that those engaged in creative activity are hardly ever eloquent when it comes to their lot. The media, too, is silent lest it be accused of self-seeking. In any case authors constitute a minority of readers.

 

Currently, tax relief provided for them is just twofold - in addition to the exemption of Rs 10,000 annually spent on books granted under section 80 of the Income-Tax Act 1961; allowing 25 per cent of royalty on books as expenses leaving the balance as taxable; and a ceiling of Rs 70,000 for deposits in the approved securities like Public Provident Fund (PPF) National Saving Certificates VIIIth issue, infrastructure-related securities, etc., prescribed under Section 88. Tax rebate is admissible to them at the rate of 25 per cent as against 20 per cent for other assessees. This is subject to the author's income from this activity constituting at least 25 per cent of his income from other sources. Thus they can save an aggregate of Rs 17,500 by way of tax.

The ceiling is anomalous, as previously it constituted Rs 10,000 over the Rs 60,000 prescribed for others. While now the ceiling for deposits has been raised for everyone to Rs 70,000 provided the whole or even part of it subject to a minimum of Rs 10,000 is invested in infrastructure related securities, it is not yet clarified that the authors could be entitled to an aggregate of Rs 80,000 on similar conditions. It is time the government set right the anomaly in the forthcoming budget which in all fairness should provide for a rise in the ceiling to 25 per cent over the one prescribed for the others or Rs 1,00,00 whichever is higher. The rate of rebate may remain unchanged.

An author can hardly contain his real expenses within the prescribed limit of the royalty. With the exception of text books or some of the `bestsellers' - usually memoirs of retired civil servants and defence personnel giving the `inside story', very few books in India have a second reprint. The standard contract with publishers prescribes for just six complimentary copies barely sufficient for the authors' family. They are expected to give complimentary copies of their work to friends, visitors, even lawyers and doctors who in turn have no hesitation in charging them full fees. Little is known that authors have to buy these copies from the publishers - at a concessional rate albeit. Not many publishing houses are reputed for regularity and accuracy in the payment of royalty, if paid at all.

While the recent amendments in the Copyright Act prescribe for stringent action against plagiarism, and the Authors' Guild of India takes up their causes, the ultimate legal battle if inevitable is long drawn and expensive for the author in whom the copyright vests.

Equally hazardous is the lot of those who write for the media. On the one hand, they have to keep themselves up to date and meet the deadline. On the other, payments of honorarium are seldom regular, let alone fabulous.

A balanced approach to the issue should be to treat the expenses incurred by them, both in case of royalty on books as well as honorarium paid by newspapers, magazines, etc., on a presumptive basis at a flat rate of 40 per cent of such income not exceeding Rs 5,00,000. Such a simplified move should also exempt them from maintaining the Book of Accounts so as to concentrate on their creative contribution to the society.

Finally, the Life Insurance Corporation of India or any other entrants in the sector may consider a suitable pension scheme to meet the requirements with tax relief to all contributions to such funds.