Un-aided schools in Bangalore will be taxed
It is final now. All un-aided schools in Bangalore will now have to shell out property tax as they will be included in the list of commercial properties. The taxation will be as per commercial rates. So far, educational institutions used to be included under the charity umbrella and were paying only 25% of the total property tax. But from now on, they might have to shell out Rs 3-5 per sqft. It is expected that this taxation will get reflected in the student fees from the next academic session.
Retailer’s Con, at the academic year start
At the beginning of a new academic year, all students in a school need to procure their new books, notebooks and stationery. Some schools just provide a book list and the parents go from place to place to procure the material. While other schools point the parents to a particular book store that the school might have tied up with. And the third category of schools tie up with retailers, and the latter open up a book stall inside the school premises for a few days.
The last category sees the most amount of blatant cheating. Here is an example from one of the book distributor retailers in Bangalore - Subhas Books. Not that they have a great reputation for doing clean business even otherwise in the market. Subhas books sells their wares in many schools in Bangalore. Their overall invoice (and packing list) is broken down to books as one category, and notebooks and stationery as the other. The example that I use is of a UKG invoice in a CBSE school, where Subhas Books supplies. The books are individually priced at MRP, which is alright. The other category which is priced above Rs 1000 is where the cheating happens. The branded stationery totals up to a little more than Rs 400 (from the MRP labels). The other material remaining are six notebooks (school branded but without MRP), one color paper packet, some labels, brown plastic covers and a school diary (both without price). This implies that the remaining material costs close to Rs 600 per the retailer, which is totally impossible!
This might not sound very untoward to you, or maybe it does. If you have experienced something like this, do write in to us. We will publish the names of these retailers, and the schools too.
Unscrupulous book retailers to avoid:
- Subhas Books - Bangalore (they sell at Royale Concorde International School)
Schools owe huge money to Bangalore Muncipality
Unaware Of revised SAS Rules, schools have to pay surcharge on tax. More than 800 schools and colleges in Bangalore are receiving notices from the BBMP with a list of arrears since 2008. At a broad level, all educational institutions in the city are exempt from paying property tax. However, the revised rules under self-assessment scheme (SAS) 2008 make it mandatory that they pay 25% of the tax amount as ‘service charges’ to the corporation considering that they also use the civic amenities provided. Majority of the institutions are not aware of the revised rules.
As per BBMP records, there are over 2,000 schools and colleges in the city including at least eight national institutions. Per BBMP, only 60% of them have promptly paid the service charges since 2008.
We did an exhibition
We ran a small physical store at the Christmas carnival of Royale Concorde International School in Bangalore on the 17th December. This was our first live experience, with limited merchandise of some stationery from Faber Castell, books from Scholar's Hub and CDs from Edurite (Manipal K-12).
Given the fact that people did not expect to see a Retail store selling our type of merchandise, we did perhaps not too badly. The experience got us a bunch of learning in terms of visual merchandising, managing the store itself and attempting to block shrinkage. And some amount of shrinkage did happen when crowds came in and we got a bit short-handed.
Shrinkage might be getting choked in the US, but certainly is a living nightmare in Retail in India. Also, of course we were doing manual billing and thus it became rather impossible to do quick reconciliations multiple times in the day. We lost at least two high value CDs, and probably some books and a bit of stationery but fortunately all in very small quantities.
So why is it?
NCERT most likely is the largest provider of text books in the country. All CBSE government schools use their books, and all private /unaided schools use their books. Each year, at the beginning of the academic session, there is a perpetual shortage of NCERT books. Each distributor that we have met so far has been moaning about the pain they have to go through to procure NCERT books. Every school we talked to this time including Vasant Valley, and Genesis Global has shown concern mentioning that their time tested distributors and publishers are unable to get NCERT books on time. And this is in Delhi. In Bangalore, its the usual every year story too.The situation as we understand, is the same in West Bengal, Orissa or any other state in the country.
The shortage gets reported in the newspapers every year (2004 report, 2007 report)without fail and 2010 was no exception. Distributors complained that they receive the books in installments and the first installment never more than 10-15% of their total requirement. The books are cheap (thankfully), but late. For distributors who cater to Indian schools outside the country (middle east, Africa for example), they need to airfreight the books thus adding to their operation cost, on top of low margins. Even with the multiple installments, the distributors do not manage to get more than about 80-85% of their total requirement. This obviously impacts the syllabus completion in schools adversely.
There must be hundreds of distributors who pick the books from NCERT. Given that, and there is a perpetual shortfall of 20-15%, it surely can't possibly be that difficult for NCERT to print more and early. If the government is unable to provide books, how will the forcible admission of extra students through RTE work well? Just that this gives rise to a different industry. Distributors mention that fake (or photocopied) versions of the books invade the market every year to make up the shortfall.
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