Tax spanner in transport operators' ad revenue hopes

KOLKATA: Auto rickshaws, buses and taxis in the city will never look the same again. They will be wrapped in advertisement boards - a desperate move the state government is adopting to offset the prevent operators' from agitating on demand for a fare hike.
The state has almost finalized the tax rates that operators will have to pay the state government for renting out vehicle space for advertisements.But the move is not going down well with operators and unions for several reasons.
Auto rickshaw owners will have to pay the state annual charges of Rs 250 to Rs 500, depending on the space used for renting out. For buses and taxis, it will vary between Rs 500 and Rs 1,500 and this too will depend on the space used for advertisements. Buses may also have advertisements on electronic boards as well as television sets, the latter already adopted by some high-end long distance private buses for showing films.
"These television monitors would be allowed within the city, which can constantly display advertisements," said an official.
"The ideas may be innovative, but will come at a price for operators. The tax to be paid to the state government for this has not been finalized yet, but will be in the range of Rs 2,000 to 2,500," hinted an official. Also, the state government will slap charges on tableaux carrying advertisements, which is currently charged only by the Kolkata Municipal Corporation (KMC). The state's plan is to impose charges on this as high as Rs 10,000 annually.
The rate structure will be issued through a notification in a week. However, the idea of the government imposing high revenue charges for advertisement is already being opposed by operators. According to Tapan Banerjee from the Joint Council of Bus Syndicate, "In any case, the number of advertisements we get won't be huge. How many advertisements will be available for 37,000 buses throughout the state?"
Banerjee said that it may not even be easy even for 9,000 buses in and around Kolkata to get advertisements.
"Even the small ads, currently on display, fetch very little in the first place - Rs 300 per month at the most. Under these circumstances, it will not resolve any problem," Banerjee said.
Private buses, argue operators, have to shell out Rs 15,000 per month extra these days for fuel due to the hike in prices, the latest being on July 15 this year. And fares haven't gone up since August 1, 2009. "We also spend money for purchasing coins since it is scarce, and keep Rs 6,000 on an average per month for police fine. So, advertisements won't help, and especially not if the government slaps huge tax on it," Banerjee said.
Bimal Guha from the Bengal Taxi Association said the taxis did have provision for advertisements in 2008-09, but it was withdrawn due to a misunderstanding between the operators and government. "Whether the new system will be of any good, will be known only after examining the rates," Guha said.
Citu's Subhas Mukherjee wasn't impressed with the idea of advertisements on auto rickshaws.
"It won't benefit workers. If the government wanted to allow advertisements, it should have first waived the tax on fuel. Only then it would have benefited owners and workers," Mukherjee said. "Whose interest will it serve now? This is just an eyewash, not a solution."
The state officials did not react. "The notification will become official only when it is issued. Till then, we cannot make any comment. However, if operators have a problem, we can definitely have discussions," said an official.