Due to GST, Newspaper Forced to Fight for Survival

Prime Minister Narendra Modi described the Goods and Services Tax (GST) as a good example of victory of integrity and cooperative federalism and said that achieving sustainability within a year of our new tax system is a huge success for the country. After completion of one year of GST, the government will focus on making less tax rates relevant to different commodities and services in the second year.

It is believed that taking action in this direction, Government will be reviewing certain goods and services included in GST in the upcoming meeting of the Council on July 19. If this happens, the number of other products involved in this tax may be lower. We expect GST to be withdrawn on newsprint used by newspapers. Everyone knows that the newspapers played a big role in the country's independence movement and became a big weapon for fighting the atrocities of the British. Press today is independent and vocal even though during the struggle of Independence it had to face lot of restrictions. At that time neither the newspapers were a means of entertainment nor were they means of earning to someone or the publisher. The newspapers were a weapon and a medium for the freedom fighters to engage with the masses at a time when they did not have any other means of communication when compared to the various present day communication channels.  

During the Independence struggle there was no one to listen to the public views and minimize their miseries. In such a situation, the introduction of newspapers and journals gave courage to the people by publishing articles, news and stories of the revolutionaries and patriots and thereby inculcated the sense of patriotism among the masses.

Since the day the country became independent in 1947, there was no tax on newsprint used by the newspapers, but the current NDA government has imposed a five per cent GST on newsprint. This has led to a rise in newsprint prices by five percent. The selling cost of newspapers is very low when compared to the production cost.  Newspapers not only contribute views and articles on important national issues and government policies, but also educate the people of the country. It is not advisable to put GST on the newsprint as it increases the cost of production. For the continuation of the expression of freedom and the constitutional values, for more than six decades, there has been a provision of zero or very slight indirect taxes on newspapers. In this regard, the Supreme Court also believes that any tax on newspapers is an attack on dissemination of news, speed of literacy and knowledge. Newspapers do not only build the nation but also play an important role in nation building. The GST cannot be considered equitable in any way on the newsprint. Recently, issuing of advertisements to the newspapers has also been reduced by the government, thereby reducing the income earned by the newspapers.  GST on the newsprint and less volume of advertising by the government organizations has really put a question mark on the existence on the newspapers, specially the small and medium newspapers. This is the reason why many newspapers (whose number is in thousands) have closed down.

GST on newsprint is causing heavy burden on newspapers. The cost of newsprint is high.  Normally, the production cost of a copy of a newspaper is somewhere between Rs. 15-20, whereas the selling price of a copy of newspaper is between Rs. 2 and Rs.5. Therefore, in order to save the national interest, the current GST on newsprint for newspapers should be withdrawn immediately from the scope of GST as newspapers are the conscious keepers of the nation.

When the Modi government came to power in 2014, we had great expectations from this government, but saddest part is that when this government came, the DAVP, under the Information and Broadcasting Ministry made a policy in 2016 as a result of which majority of the small and the medium newspapers were out of the list for awarding advertisement to them by DAVP and were forced to shut down thousands of newspapers. On the other hand, strict rules were made in which many newspapers were excluded from DAVP empanelment. On the other hand, the Press Council of India (PCI) put many restriction on the newspapers. Just last year, on the excuse of Fake News, many newspapers were suspended by PCI.  Now day in day out new Advisory is being issued and if it is not followed, the newspaper is in a way threatened with de-empanelment. Today the newspapers are fighting the battle for their very survival throughout India. Today, the newspapers, the fourth pillar of democracy and a mouth piece of the freedom is in a state of siege. Most of the major newspapers have either shut down several editions or have been forced to cut the number of staff. Small and medium newspapers had already started doing this.

Due to the above, newspapers are either forced to hike the rate per copy or dispense with the staff therefor the unemployment in the newspaper industry is also increasing day by day. With the implementation of the recommendations of the previous UPA-2 government's Majithia Wage Board, there was additional burden on the newspapers when the previous government accepted the report of the board and forced the newspapers to increase salaries by 45 to 50 percent. But the salary of the employees working under the category of four had also increased more than double-tripled by the salary earned from other industries.

Today under what circumstances, one has to serve a newspaper has been explained in details so that the Modi government can help us and save us from drowning. Newspapers played a big role in coming into power of the Modi government and now when they are fighting the battle for their very existence, the government should also come out in their support and consider those fiery problems faced by the newspaper organisations and resolve them.

-Anil Narendra