Putting up with the ‘bill’ in billboard

Shahzad Jillani July 11, 2010

KARACHI: Phet wiped Karachi clean of its gigantic, colourful billboards even without paying the city a visit.

The city government had decided to take down hoardings and billboards from all main roads and important streets when the cyclone threat had the city in its panicked throes. However, weeks after the cyclone dwindled and passed by without so much as a tall wave, the advertisements have yet to be put back on to their boards again.

According to an advertiser and contractor of hoardings, the decision has caused a ‘great loss to business’ since the contracts they have with the administrations in both city government and Clifton Cantonment Board do not account for these situations. If the boards are taken down again there is no clause to assure that they will be put back again without the extra cost. Now advertisers will have to pay extra bribes to get their boards back up.

Contractors claimed that while the city government and cantonment board earned billions of rupees in taxes from these advertisements, the contractors were not compensated for the loss they incurred in situations like the cyclone. Advertisers demanded that there should be a proper policy which includes clauses for reimbursement of losses to them in case their billboards are pulled down before the agreed time and if their contracts are not followed word by word, the advertisers should be given compensation.

“The classification of taxes is based on jurisdictions. Sites like Clifton and Karsaz, which come under the jurisdiction of Clifton Cantonment Board (CBC), fall under category A and their tax is higher than that of the city government’s sites,” explained another advertiser.

The tax department charges Rs60,000 for a 10-by-20 feet billboard that falls under B category. As with all businesses, billboard advertising too has its underhand dealings. “The staff takes Rs100,000 to hand out a priority contract award,” alleged an advertiser, explaining that these awards can get them the deal sooner.

Another advertiser said that he has to pay Rs200,000 in taxes for a 15-by-45 feet B category billboard along with an ‘extra’ amount, which can range from Rs150,000 to Rs300,00 depending on the site.

The tax charged on the same sized billboard that falls in category A is Rs0.7 million, while the underhand amount paid for this can range from Rs0.25 to Rs0.35 million, bringing the total cost to almost one million rupees.

According to Ehsan Amjad, a contractor, the sites under the city government’s jurisdiction are available more easily than those under the cantonment. Amjad feels that corruption was most rife in the business during the previous city government. “The cost of pleasing people was more than what I earned,” he said.

Another advertiser has claimed just the opposite, however. “Things were much smoother when Mustafa Kamal was nazim,” he said. According to the small-scale advertiser, there is no auction system for billboards in the CBC. “Contracts for billboards as big as 60-by-20 feet or 90-by-30 used to be awarded through open bidding at Civic Centre. Everybody had an equal and fair chance to participate in the bids,” said the advertiser. “CBC officials ask you to fill in a form and the next day when you go to them, you find out that the contract has already been awarded to someone without any procedure,” he claimed.

The same advertiser also felt that the business might not be squeaky clean but the few bribes that they have to pay gets them a long way in the booming billboard business.

A CBC official denied these allegations when asked to comment and said that they had a transparent system through which they awarded contracts.

“We have a list of contractors whom we consider suitable. If a new contractor approaches the CBC, the board has a right to turn down the proposal based on their pre-qualification standards,” the official told The Express Tribune. However, he declined to give figures of the revenue earned from taxes charged on putting up hoardings on sites that fall within its jurisdiction.

Meanwhile, an official of the city district government said the CGGK had nothing to hide either. “The money collected from billboard taxation is available in the CDGK’s budget book and the details of all work under the CDGK are available online where anyone can see it.”

Published in The Express Tribune, July 12th, 2010.


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