Telecom operators want the government to refund a temporary tax credit (ITC) of around Rs. 35,000, reduce taxes, and exempt GST for license fees and spectrum use in the next budget.
According to a pre-budget recommendation from the telecommunications industry group COAI, which includes Vodafone Idea, Bharti Airtel and Reliance Jio, the telecommunications sector will be the Universal Service Obligation Fund (USOF) to financially support the development of telecommunications services in rural areas. ) Wants to stop the government. It reduces the burden on the area and service provider.
“We will refund 35,000 rupees for unused ITCs in the industry. This will not be available in the near future. Due to the dynamics of the current market, large ITCs are accumulating.
“Credits will be further increased by future large capital spending to further enhance the customer experience and achieve the vision of Digital India,” COAI said.
Currently, the license fee paid by a telecommunications carrier is calculated as 8% of the revenue earned from telecommunications services and is technically referred to as adjusted gross revenue (AGR).
The government has removed some sources of revenue that were part of the AGR and abolished the spectrum usage fees (SUC) for radio waves purchased at future auctions as part of communications reform.
“We thank the government for recent positive structural and procedural reforms, which we believe not only bring stability and sustainability to the sector, but also promote the digital needs of our citizens.
“The telecommunications industry needs to invest in robust and reliable telecommunications infrastructure to meet the growing demand for connectivity. There is an urgent need to reduce the tax burden on the sector. “The COAI Secretary-General, SP Kochhar, said.
The Association of Cellular Operators of India (COAI) has requested the government to reduce the license fee for spectra acquired in past auctions from 3% to 1% and the SUC rate by 3%.
“A typical license fee is 8% of AGR, which includes a tax of 5% on USO funds. Existing USO fund corpora over 59,000 rupees will meet USO goals over the next few years. That’s enough. USO can stop until the existing corpus is used. “
According to industry groups, about 85% of domestic telecommunications equipment is imported and a 20% basic tariff (BCD) is levied.
“Raising tariffs on telecommunications equipment has confused the cost-effectiveness of telecommunications companies. BCD exemptions should be granted to telecommunications equipment.
“We need to eliminate tariffs on 4G / 5G-related network products and other related products until high-quality equipment is available in India at an affordable price,” says COAI.