Telecom operators have asked the government to finalise guidelines and regulations for mortgage of spectrum to raise funds in the next Budget.
GSM operators’ lobby Cellular Operators Association of India (COAI) and CDMA operators lobby Association of Unified Telecom Service Providers of India (AUSPI), in their Budget recommendations to the Finance Ministry, have also said that the government should revise levies and taxes on the industry which amount to more than 30% of the revenues.
Besides seeking the long-awaited infrastructure status for the telecom sector, COAI and AUSPI have said that the government should reduce Minimum Alternative Tax (MAT) as it was introduced as tax for NIL tax rate companies.
To promote usage of smart phones and tablets, the operators lobbies have also recommended that the Government should amend the 7(vii) of Rule 3 to exclude the benefit arising on use of Tablets/ iPod/ Smart phone by the employee out of the ambit of perquisite since such devices are nothing but advanced version of laptops/computers only and provide the similar features and used as working tool by the employees.
Earlier in its recommendations, the Department of Telecommunications (DoT) has also recommended the same.
COAI and AUSPI have also sought continuation of tax holiday benefits for mergers and amalgamations and the Government should incorporate required amendments on this. The government should also bring in effective provisions to prevent misuse instead of doing away with the provisions altogether, according to the COAI recommendations.
The DoT has already proposed that the Ministry of Finance to abolish service tax on pure internet/broadband services in the next Budget to make it affordable for the end users.
The high cost of internet, which currently attracts a 12% service tax in line with other telecom services, is one of the reasons for slow growth of this essential service within the country, DoT said in its recommendation for Budget 2013. DoT has set a target for 175 million broadband users in the country by 2015. There are just 14.88 million broadband users in India at the end of November 2012, according to data published by Telecom Regulatory Authority of India (TRAI).
