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Budget 2019: Here’s what the advertising industry is expecting

Stalwarts from the ad industry are expecting lower GST, more focus on digital infrastructure, and action on the economic and fiscal incentives for technology companies.

July 01, 2019 / 09:08 PM IST

India is considered as the fastest growing major advertising market in the world. The ad industry for 2018 was pegged at Rs 61,878 crore ($8.76 billion) and it is expected to reach a market size of Rs 85,250 crore ($12.06 billion) till 2021.

An industry, as big as this is, expects to not only come under a lower Goods and Services Tax (GST) bracket, but also looks for simplification of the GST process. 

Talking to Moneycontrol, Dentsu Aegis Network Chairman and CEO South Asia, Ashish Bhasin said that 18 percent GST is too much for the industry. “In fact, it is higher than the service tax which was levied at 12 percent,” he said. 

Concurring with Bhasin, NeoNiche Integrated Solutions CEO and MD Prateek N Kumar said, “Currently, 18 percent GST is levied on digital advertising and 5 percent on print. A bit of parity is required in this space, especially to bring uniform taxation for both print and digital advertising.”  

Adding to this, The Minimalist Director-Corporate Centre, Himanshu Gander said that the existing GST structure needs to be streamlined. 

The ad world is also urging the government to focus on a robust digital structure, which, according to the industry players, is the need of the hour.

“As an organisation, which heavily focuses on providing design and digital services, we are definitely looking forward to some additional budget being allocated by the government to improve the digital infrastructure of the economy," Gander said. 

According to Vertoz Founder and Chairman Hiren Shah, who runs a programmatic advertising company, “India will need to create a better digital infrastructure for the storage of the huge volumes of data with the current discussions revolving around data security and data localization, especially now that the Personal Data Protection Bill 2018 is in the spotlight.” 

He added that growth in any sector translates into an increase in its budget for digital advertising. “This kind of progression in the economy will lead to increased digital advertising which, in turn, will propel the growth of programmatic as the go-to solution in the industry,” Shah said. 

In the Indian advertising space, the shift of ad spending from traditional media to digital is happening at a rapid pace.

This is why ADOHM CEO Kuldeep Chaudhary, whose marketing platform is powered by Artificial Intelligence, believes that “the presence of technologies based on Artificial Intelligence can further increase the interaction between consumers and companies”. 

"Hence, the government's action on the economic and fiscal incentives for technology companies is fundamental," he added.
Maryam Farooqui
first published: Jul 1, 2019 09:08 pm