Telecom service providers to meet DoT officials

Bhaskar Hazarika

NEW DELHI: The telecom service providers will meet with officials of Department of Telecommunications (DoT) on Thursday to highlight their demands in the forthcoming DoT's budget list.

The service providers have been demanding reduction in revenue share license fee, single taxation, lowering the service tax and spectrum charges. With the recent decision by the government to reduce the revenue share license fee for long distance services the service providers have been demanding uniform reduction in license fee, including Universal Service Obligation (USO) levy for unified access service providers.

The Association of Unified Service Providers of India (AUSPI) has issued a paper on the pre-budget recommendation questioning the need of revenue share license fee for the telecom sector. The paper states that India has one of the highest tax regimes in the world and levies must be reduced to bring them in line with international best practices. Presently the telecom operators pay around 17-26 percent of their revenues towards service tax, license fee (including USO), and spectrum charges.

“High percentage of revenue share to be brought down to 6 percent including levy for USO fund. The high service tax to be brought down as one-third of the total collection of service tax is generated from the telecom services,” the paper said. The AUSPI has also stated that with the growth of 3-4 million subscribers per month the additional revenues would compensate for the reduced taxes and levies.

However, when contacted DoT officials denied revealing the details of the meeting scheduled to be held tomorrow afternoon.

According to Cellular Operators Association of India (COAI) the reduction in license fee would rather boost subscriber growth and result in higher average revenue per user as the service would become more affordable attracting more subscribers.