Colombia reduces Pay-TV tax contribution rates

NexTVLatam | Monday, December 20 2010
The Colombian National Television Commission decided to reduce from 10% to 7% the percentage on gross income tax paid by Pay-TV operators. Such measure will become effective as from January 2011. According to the aforementioned agency such decision is applicable to “all Pay-TV operators, either cable or satellite (DTH), and any other independent broadcasting technology modality utilized”. Moreover, 10% to be paid on sponsorship has been kept.
The measure started to be analyzed after several operators began to consider the possibility to migrate towards IPTV with the purpose of not paying the 10% set by the commission thus paying the 3% of their gross income to the Ministry of IT and Communications as added value operators do.
The National TV Commission informed that the new agreement sets that current licensees can expand their coverage areas towards any municipality and even become national operators, provided some requirements set by the commission are met, such as the submission of technical expansion and investment plans and the payment of the requested expansion value to be determined according to studies carried out by the entity.
Likewise, the agency pointed out that the measure will be applied in a “very strict” manner including the termination of the contract, sub-invoicing or sub-reporting on behalf of operators.
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