Govt rejects single tax, levies demand of telecom ind

The government has rejected the telecom industry's plea for a single tax regime, giving a big blow to the private GSM operators long-pending demand.

A committee was constituted to study the structure of taxes and levies in the telecom sector and it recommended to continue with the single tax regime which was accepted by the Government, Minister of State for Telecom and IT Gurudas Kamat said in a written reply in Rajya Sabha today.

He said several Union and state governments offices as well as individual subscribers owe Rs 4,748.96 crore and Rs 1,179.84 crore to state-run telecom firms BSNL and MTNL, respectively.

The levy rationalisation committee was set up in the Budget 2007 to study the taxation and levies in the telecom sector, which is about 30 per cent of the total revenues.

The industry was expecting reduction in the revenue share of licence fee to an uniform six per cent across the country from the current 6-10 per cent and also replacement of the multiple levy structure in the sector with a single levy.

The telecom industry led by the GSM operators has petitioned the government that they pay the highest levy structure in the world compared to 6 per cent paid by their counterparts in other Asian countries.