Budget 2019: Telecom Operators Want FM Sitharaman To Consider Higher Tax Exemptions, Infra Push

Telecom operators want the government to provide tax exemptions and broadband service providers have recommended greater emphasis on fiberisation among others.

Telecom industry has also sought exemption from GST on spectrum payment, license fees and spectrum usage charge. (Image: PTI)

Budget 2019: As Finance Minister Nirmala Sitharaman presents her first Union Budget on Friday, telecom operators want the government to provide tax exemptions and broadband service providers have recommended greater emphasis on fiberisation among others. According to the Cellular Operators Association of India (COAI), higher customs duty on the telecom equipment is disrupting the cost effectiveness of the telecom operators. The industry body, in its budget recommendation, said: "Exemption from the levy of BCD (basic customs duty) should be granted on the telecom equipment", adding that "exemption from IGST (Integrated Goods and Services Tax) may also be granted for hassle-free importation of such vessels". It has also sought exemption from GST on spectrum payment, license fees and spectrum usage charge. "Given the huge burden of taxes and regulatory levies on telecom operators and considering the fragile state of their finances, special benefit should be provided to telecom operators in GST by way of exemption on regulatory payments of LF, SUC and spectrum assigned under auction," it said. The COAI also asked the government to exempt operators from levy of service tax on Right of Way permission granted by the Centre, state governments and the development authorities. The Broadband India Forum (BIF) also said that for achieving the National Digital Communications Policy's (NDCP) target of $100 billion investment in the India's telecom and digital space, the businesses need to be made more profitable and attractive for which high levies and spectrum charges have to be reduced. "Exorbitant spectrum prices, very heavy levies and charges and some onerous licence conditions need to be corrected on priority to boost investments," it said. It also suggested an infrastructure-push in the the form of higher fiberisation for the efficient internet coverage and success of the upcoming 5G network. Further, the introduction of a number of new small-time players in WiFi provisioning space (PDOs) will be able to boost the broadband availability to the masses, the BIF said in its budget recommendation. It also said that the potential of satellite communications should be tapped by optimisation of policy and regulatory framework.