Magazine publishers gear up to revoke 12% GST on LWC paper

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Magazine publishers gear up to revoke 12% GST on LWC paper

After firing a letter to the Union Revenue Secretary asking for the removal of 12% goods and services tax (GST) on lightweight coated paper (LWC), magazine publishers are gearing up for a long-drawn struggle with the government. Though industry sources indicated that a meeting is being sought with Hasmukh Adhia later this week, the publishers are aware of the fact that the Revenue Secretary alone will not be able to reverse the decision. Being pragmatic, magazine representatives don’t expect relief in less than two-three months’ time during which they would have to bear the increased taxation burden.

Given the scenario, publishers will seek the retrospective removal of the tax since it came into effect on 1 July. Industry sources agreed that the government will not respond easily because the policy formulation has already happened. However, the magazines are pinning their hopes on Union Information and Broadcasting Minister Venkaiah Naidu and I&B secretary NK Sinha. They expect the MIB to recommend their case to the GST council for further consideration.

Kerala Finance Minister TM Thomas Isaac and his West Bengal counterpart Amit Mitra are being zeroed in as individuals who could push the case of publishers before the GST council because the final decision rests with that body. In a letter addressed to the Revenue Secretary on 11 July, the Association of Indian Magazines (AIM) had come down heavily on the government’s decision to levy a higher tax rate on LWC paper. The association demanded that magazines be treated at par with newspapers as per the provisions of the Press and Registration of Books Act, 1867. “We request you to please withdraw the GST levied on LWC paper up to 70 gsm completely or at least bring it to 5% and ensure parity with newspapers,” said the letter.

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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