TAXATION MANAGEMENT(8531)

Assignment on Subject:
Taxtion mangagement
Submitted To:
SIR ARISH
Submitted By:
UNSA ARSHAD

Roll No:
BI589024
M.COM:
4th semester

Tax on the incomes of media houses

in Pakistan

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ACKNOWLEDGEMENT
First of all we are thankful to Almighty ALLAH for giving
us much cooperation and supporting parents who has given us this
opportunity to study here. I would like to thank sir Arish for giving us the
confidence and opportunity to prove ourselves.

TABLE OF CONTENT

CONTENTS
Acknowledgment

Tax on the
incomes of media
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houses in Pakistan

Introduction Income tax

 defination media
 Media houses

 Source of media
 Deduction of tax
 FBR
 New tax on media
 Case study
 Geo TV
 Mission
 Vission
 Value statement
 Swot analysis
 conclusion

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INCOME TAX

What is an 'Income Tax'

An income tax is a tax that governments impose on financial income
generated by all entities within their power. By law, businesses and
individuals must file an income tax return every year to determine whether
they owe any taxes or are eligible for a tax refund. Income tax is a key
source of funds that the government uses to fund its activities and serve the
public.
Reduction of income tax rates:
-Tax exemption on annual income up to Rs1.2m
-5% tax on annual income between Rs1.2 and Rs2.4mn
-10% tax on annual income between Rs2.4 and 4.8mn
-15% tax on annual income above Rs4.8mn

DEFINITION of 'Media
A theory that relates how stories published in the media influence or
amplify current trends. Borrowers or investors will read an article and be
influenced to act quickly on the news. The media effect is often seen in
the mortgage market, when prepayment rates can sharply increase
following specific news stories.

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What is a 'Media Buy'

Media buy is the purchase of advertising from a media company such as a
television station, newspaper, magazine, blog or website. It also entails the
negotiation for price and placement of ads, as well as research into the best
new venues for ad placement
.
Role of media in Pakistan
Pakistani media relates dramas, movies, sports, news and entertainment
and so many features to the people. Its dramas reflect society and
happenings and issues in the society not only to the people of Pakistan but
also to the whole world, news channels alarm the people about all the
current happenings, within and outside the country.
Media has played very important role in reshaping, and changing the
people in Pakistan. It has revealed the facts to the people about crimes and
social issues and also informed the people about the issues outside their
country and most importantly, media has shown the behavior of other
countries to the Pakistan, The media mainly television has become the
main storytelling vehicle and the journalists have become the key players
in legend making and identity building. Professional journalists are
responsible to create a sense of belonging and to encourage the youth of
Pakistan to behave like a responsible Pakistani.
Somehow media, on the name of freedom of press, is completely going in a
new direction. There is a great competition among the channels and it has
gone to fierce conditions, that they have starting to use negative tools, too
increase their viewership.
Media has been thinking to be a positive and sophisticated tool to talk
about image building. When something comes about the national interests,
it is the responsibility of media to handle the situations and prosperity of
the country. Media is considered to be a watchdog in a democratic
country. No doubt media is doing fine work with positive approach
towards the people and society. It’s the requirement of time that our media
should work for the positive and real soft image of Pakistan.

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Media houses
Media House was established in Pakistan with the purpose to build the
capacity of the working journalists in Khyber Pakhtunkhwa (KP) and the
Tribal Areas in particular, Balochistan and the rest of Pakistan in general.
It opened its office in Peshawar in collaboration with Media in 2008 and
moved to Islamabad in 2013, which later on registered as an independent
organization.Media House provides a platform to train journalists from
Pakistan, especially the KP and the Tribal Areas to help build peace and
resolve conflicts through effective and efficient use of media. The Media
House workshops and training sessions help the working journalists to
enhance their professional skills. These activities offer them opportunities
to improve media coverage and play their role in building and
strengthening peaceful and democratic society. The trained journalists
help in multiplying the impact of these activities by sharing their
experiences with other local journalists in their respective press
clubs.Media House has established a strong networking liaison with radio
stations, press clubs, media faculties of the universities and other media
organizations through Pakistan particularly Khyber Pakhtunkhwa/FATA,
and Balochistan. It has been contributing to the professional growth of the
working journalists in radio and TV production by arranging trainings for
mid career journalists since 2008. It has been working closely with
academics in universities on curriculum projects in the discipline of
Journalism and Mass Communication.

The Media House training activities have been supported and continue to
get support from Friedrich Ebert Stiftung (FES), Medio thek Afghanistan,
Heinrich Boell Stiftung (HBS), Deutsche Welle Radio and Television
Akademie, and UNESCO during these years. Media House board consists
of professionals with experience in local, national, and international media
organizations. At present, Media House is focusing on developing
curriculum for universities and building the capacity of journalists in
Conflict Reporting and focuses on conflict-sensitive Journalism; physical
and digital safety in conflict reporting; psychological risks; ethical
standards in crisis reporting; and strengthening of local government system
through effective media coverage.

The Director of the Media House Islamabad enjoys respect among the
mainstream media institutions of the country. He has worked with DW

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A kademie in Germany, and remained Professor of Journalism for more

than 20 years in the University of Peshawar. He is member of the Pakistan
Press Council; Pakistan Electronic Media Regulatory Authority
(PEMRA); and several academic bodies of Universities. He was
instrumental in founding the first ever community radio in University of
Peshawar in the year 2003.

Media House has a strong internal mechanism of monitoring and

evaluation. It monitors all activities and makes changes if required as a
corrective action in the design or planning on the basis of the evaluation of
results. All the activities carried out are documented regularly with impact
analysis in progress reports and the achieved outputs are checked through
evaluation report.

Source of media
Newspaper
Radio
Tv
Internet etc

Deductions of tax
Tax must be deducted from every payments income or salary is calculate
on yearly basis means salary *12 and than find that either this income is
exempt able from tax or not if not than how much tax should be charge in
each month.
Media services by non-residents Taxation of income arising from media
services by non-resident, subject to final tax, is governed by section 152
(Finance Act, 2012) replaces section 153A) and 169 of the Income Tax
Ordinance, 2001, 153A and 154). The tax deducted at source at the time of
payment against media services to a non-resident is nonadjustable tax
deducted at source and the income arising from payments received against

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media services by non-resident subject to deduction of tax at source is

chargeable to tax, if not otherwise exempt, as income subject to final tax.
The rate of final tax is 10% of the gross amount for providing such
services..

FBR:
Federal Board of Revenue (FBR) has updated advance tax to be collected
from cable operators and other electronic media at the time of obtaining
new license or renewal of license.
Advance tax on cable operators and other electronic media under Section
236F of Income Tax Ordinance, 2001.
PEMERA
Sub-Section (1): Pakistan Electronic Media Regulatory Authority, at the
time of issuance of licence for distribution services or renewal of the
licence to a licence, shall collect advance tax at the rates specified in
Division XIII of Part IV of the First Schedule.
Sub-Section (2): The tax collected under sub-section (1) shall be
adjustable.
Sub-Section (3): For the purpose of this section, “ television operator”
“DTH”, “Distribution Service”, “electronic media”, “IPTV”, “loop
holder”, “MMDS”, “mobile TV”, shall have the same meanings as defined
in Pakistan Electronic Media Regulatory Authority Ordinance, 2002 (XIII
of 2002) and rules made thereunder.

Division XIII of Part IV of the First Schedule

(1) The rate of tax to be collected under section 236F in the case of
Television Operator shall be as follows:—

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License Tax on License Fee Tax on Revenue

Category as
provided in
PEMRA Rules
Rs.10,000
H 7,500
15,000
H-1 10,000
30,000
H-2 25,000
12,000
R Rs. 5,000
40,000
B 5,000
35,000
B-1 30,000
45,000
B-2 40,000
75,000
B-3 50,000
100,000
B-4 75,000
150,000
B-5 87,,500
200,000
B-6 17,500
B-7 262,500 300,000

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B-8 437,500 500,000

B-9 700,000 800,000

B-10 875,500 900,000l

(2) The rate of tax to be collected by Pakistan Electronic Media Regulatory

Authority under section 236F in the case of IPTV, FM Radio, MMDS,
Mobile TV, Mobile Audio, Satellite TV Channel and Landing Rights, shall
be 20 per cent of the permission fee or renewal fee, as the case may be.]
(3) In addition to tax collected under paragraph (2) Pakistan Electronic
Media Regulatory Authority shall collect tax at the rate of fifty per cent of
the permission fee or renewal fee, as the case may be, from every TV
Channel on which foreign TV drama serial or a play in any language, other
than English, is screened or viewed.
Last year, 2017
On the recommendation of PEMRA and to promote Digital Technology in
the country, import of Set Top Boxes, TV broadcast transmitter, Reception
apparatus etc. were allowed to be imported at concessionary rate of 11%.
This facility is available till 30-6-2017. Now it is proposed that the date of
this concession may be extended till 30-6-2018. Concessionary rate of
sales tax at 5% is also proposed to be extended till 30-6-2018.

Case study:

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INTRODUCTION GEO

GEO TV was established in May 2002. Test transmission started on 14th

August 2002 on the PAS 10 digital satellite. Regular transmission started
on 1st October 2002. Geo TV is the first South Asian Urdu language
channel to provide content comparable with excellent television
broadcasters. Geo is the fastest growing TV Channel in Pakistan with
ratings exceeding all satellite delivered TV channels in the market. Geo
has the widest distribution on cable systems in Pakistan with 100%
carriage within 90 days of launch.It launched the first interactive
infotainment programs in Pakistan, engaging and empowering the viewer.
Consistently scoops all rival broadcasters on major news events. Besides
seven bureaus in Pakistan, a robust international network feeds live content
from New York, Washington and London. Intelligent Media Consultant
has given formal multi-disciplinary training to 500 members of GEO staff
including all producers, reporters, writers, camera persons and editors.Its
member team comprising of CNN, BBC producers, cinematographers,
editors and presenters were split in Dubai and Karachi for 5 months to
complete the training
GEO TELEVISION NETWORK
GEO started its test transmission on 14 Auhe National association of
Broadcasters (USA). World’s largest association of broadcasters has
honored GEO with the “Award for Quality” declaring it an international
standard television channel.” To build a reputable identity in a cluster of
different channels in just a period of four years was not an easy task. Geo is
known for its unique entertainment, hot talk shows, truth revealing news
and informative programs.

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“The National association of Broadcasters (USA). World’s largest association

of broadcasters has honored GEO with the “Award for Quality” declaring it an
international standard television channel.” To build a reputable identity in a
cluster of different channels in just a period of four years was not an easy task.
Geo is known for its unique entertainment, hot talk shows, truth revealing
news and informative programs.

MISSION STATEMENT
GEO informs and entertains while celebrating cultures and prompting dialogue
in the spirit of "live and let live" or nation of the composite represents ‘EYE
ON WORLD AFFAIRS 24 HOURS A DAY’.
An animated spot, ‘Peela-Neela’ was specifically aimed at unveiling the
‘Design Rationale’ of the logo to the audience. The logo has been warmly
received by the Pakistani audience and in a short span of time has come to
represent Quality Broadcast with great production and content values.

VISION STATEMENT:
 “GEO will be the voice of freedom from the Asian subcontinent.
 It will highlight the issues of concern and the cultural richness of its
people through information, discussion and entertainment.
 GEO will propagate transparency of responsibility that will ensure its
position as the most credible and meaningful source of information,
through quality programming based on issues.
 GEO will provide entertainment audiences can relate to, thereby
creating viewer loyalty and response.
 GEO will forge an alliance among its three stakeholders - viewers,
advertisers and shareholders to maximize viewer ownership.
 GEO will invest in human resources as it recognizes it to be the
foundation upon which the GEO future will be built.

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 It is this very foundation that will allow GEO to attain and sustain a
leadership position, thus fulfilling the promise associated with its
creation.”

Basic objective:
Like all for-profit organizations, GEO’s basic objective is also revenue
generation.

VALUE STATEMENTS
 We are a team.
 We respect each other.
 We encourage self-development.
 We hold high expectations.
 We embrace change.
 We value our Viewers.
 We provide exceptional service that leaves an impression.
 We support our community.
 Consistent entertainment service and production quality.
Swot analysis:

GEO Strengths
•
 To build a reputable identity in a cluster of different channels in just a
period of four years was not an easy task. Geo is known for its unique
entertainment, hot talk shows, truth revealing news and informative
programs. Following point summarize the strengths of GEO;

 National association of Broadcasters (USA). World’s largest associat

ion of broadcasters has honored GEO with the “Award for Quality”
declaring it an international standard television channel.

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 Some international newspapers, magazines and news agencies have

commented on the unique style of GEO and various have quoted it
extensively. These include New York Times, Washington Times,
Financial Times, Washington Post and
other important television channels. Even the US State Department of
ten quotes GEO.Geo has been described as the CNN and BBC of
Pakistan due to its enormous news network within Pakistan and
all over the world.

 Geo is the only independent and liberal channel with the unique honor
of consistently breaking news.
 The journal of Mass Communication, quotes that it was the first to
come up with the election results even beating the state channel,while
its interviews and analysis got top ratings among the viewers.It
further quoted that Geo offered new and innovative ideas not seen bef
ore on any television channel.

 According to Gallup, Geo is highly rated and the most watched satellite
channelin Pakistan for its entertainment, news talk shows and flavored
programs.

 New York Times, one of the most prominent newspapers of the world,
has quote that Geo changed the media scene of Pakistan. It is the most
popular channel with the highest viewer ship in cities.Geo won a
special award at the notic aslo TV festival 2005
 .Geo has also been awarded best electronic mass media award 2004 by
Pakistan adv. Association.
 Business week one of the top 3 magazines of the world while including
the news of MSR in 25 stars of Asia wrote that
“Geo has become the most watched TV channel of Pakistan and its viewer
ship is growing at the rate of 30% annually.

GEO Weaknesses

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 GEO is owned by a local group i.e. Jang Group that has comparatively
fewer resources than financial backing of ARY
 GEO has shortage of good talent. For this reason they had to buy Indian
programs to fill up their 24 hour TV run time

 Major sponsors such as the Lever brothers show more interest in ARY
as it is more established than GEO
ment channel, GEO now has an opportunity to make a name for itself in the
entertainment industry as well. With the trend of watching Cable TV
increasing GEO opportunities

 With the launch of its new entertainment channel recently GEO now
owns two channels namely GEO news and GEO entertainment.

 Its ever increasing popularity is not only an opportunity to cash in, but
is also as challenge because building up a reputation is one thing and
living up to it another.

 GEO TV has already made a name for itself as the best news channel in
Pakistan and plans on continuing the unbiased and undeterred
reporting it is known for.But with the launch of its entertain

 ,GEO can become a household name in all the facades of television if it

carries on with the same zeal zest and fervor it has shown in its news
making
.

GEO Threats

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 With the influx of more and more private channels, the competition is
increasing by the day.

 People are becoming more and more aware of the international

standards of media and demand the same from their own channels.

 The media policies of the government though much improved still left
a lot to be desired.

 They cause a lot of hindrance in independent news making. So the riv

alry between GEO and private channels and the rigid media polices of
the government remain the biggest threats to GEO.

Conclusion
GEO enjoys a status of a rapidly growing TV channel.. The reason is
simple, people nowadays want a choice between watching TV channels.
They have suffered enough back when PTV was a monopoly. Back then
they only had a small exposure to knowledge via TV. Nowadays, however,
people are ‘addicted’ to media. The absolute choice between two
competing channels is almost impossible to make, since the viewer wants
to assure himself by watching the second channel that what the first
channel is saying is correct.The viewers like some programs of GEO and
some programs of ARY.Hence, in fact not only the channels have
segmented the viewers but the viewers also have divided the channels into
different segments to watch in their leisure. There fore to give up one
equally beneficial segment for the other when one can have both,
wouldn’t be a sensible choice for a sensible person.PTV is now being
enjoyed by the terrestrial network viewers. So it has least share but people
still like the dramas which are of its traditional culture. So despite of
deficit but it still has a large market share due to its terrestrial network.So
GEO is on the top due to the above mentioned reasons.

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