M-Net riled up over proposed licensing fee

JOHANNESBURG — South African pay TV station M-Net is enraged over a proposal by the Independent Broadcasting Authority (IBA) to slap it with a license fee of about 17 million rand ($3.8 million) annually.

The proposal, made public Friday, drew fire from M-Net chief executive officer Lazarus Zim, who claimed the figure represents about half the IBA’s total annual budget.

“We believe it is unfairly punitive to expect M-Net to carry such a large proportion of the IBA’s overall costs,” Zim said Monday. “The enormity of this figure becomes obvious when compared to our total shareholder dividend of $5.1 million for the 1995-96 year,” he said.

M-Net, which boasts about 1 million subscribers across Africa, pays $17.8 million in direct and indirect taxes every year, but under its current license, granted by the former apartheid government, it pays no licensing fee.

“We object to the imposition of such additional forms of indirect taxation on the private sector,” Zim said.

M-Net and the IBA are due to negotiate the terms of M-Net’s license over the next month.

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