GST impact: Govt expects lower phone bills, telcos differ

Under GST, telcos have to pay an 18% levy but can claim input tax credit

Telecom companies have warned of a 2-3 per cent increase in phone bills in the goods and services tax (GST) regime even as the finance ministry has asked them to “re-jig prices and re-work costs” to pass on benefits to the consumers.

The Cellular Operators Association of India (COAI), the industry body, has said that the notion that the increase in the GST rate will be cancelled out by a reduction of cascading tax costs (on account of the fact that the state value-added tax, entry taxes, and special additional duty on procurement have been subsumed) is misconceived.

“The GST