Cable Crisis

Nov 25, 2010 (LBO) – Sri Lanka’s cable TV firms are facing a crippling tax that may put all of them out of business, following the imposition of a new ‘teledrama’ tax that has already hit terrestrial ‘free to air’ channels. Industry officials say the cable TV industry would not be able to survive if they have to pay the tax.

The so-called ‘teledrama’ tax was imposed on local TV channels following representations from producers of Sinhala language dramas who could not get airtime on broadcasters to stop the import of especially Hindi language films and dramas.

The government reduced the tax of English language programe’s after broadcasters were almost put out of business by the tax, which was charged by each hour of broadcast. The broadcasters have still not recovered from the effects of the tax.

Typically free to air channels have only a few hours of taxable content a day, but cable firms have several channels which air taxable entertainment programs 24 hours a day.