Entertainment sector Pre Budget

BUDGET 2012
Cinema industry exempted from service tax. The concessional basic customs duty of 5% and CVD* of 5%, (presently applicable to high speed printing presses imported by newspaper establishments )is extended to mailroom equipment. Jumbo rolls of cinematographic film fully exempted from CVD by providing full exemption from excise duty. Expand the raw material list for manufacture of specified electronic components that are fully exempt from basic customs duty.
*Countervailing Duty - A special duty imposed on imports to offset the benefits of subsidies paid to producers or exporters

ANIMATION AND GAMING

The Indian Animation industry was worth US$ 511 million in 2010 and is expected to grow at CAGR of 23% to reach US$ 961 million by 2013.

VFX INDUSTRY
"Only 40 per cent of the talents in our animation and VFX industry are capable of creative output. The cost of animation production in India is one fourth of that in North America

10 to 15 per cent of an Indian film's budget allocated for visual effects

"Out of the 400-odd VFX and animation companies in our country, only a dozen of them are really doing creative work.

 Outsourcing of work to India on the rise moving up the value chain. Dominant domestic players setting up offices abroad. Increasing consumption in the domestic market. Oscar for life of pi brings global recognition and investment

Budget 2013
Government should consider setting up centres of excellence for the animation, gaming and VFX industry. Ten years tax holiday for the animation, gaming, and visual effects industry. The removal of withholding tax on revenues accruing from sales of mobile games in non-India markets and on the development contracts given to mobile game developers outside India. Provision of 50% reimbursable MDA (Market Development Assistance) for travel and registration fees to international market events. Excise duty on local manufacture should be brought down from 12.5% to 0%