Budget Expectations for Telecom Industry: Budget should give clarity in levies for telecom industry: ICRA

NEW DELHI: The telecom industry has been looking for monetary incentives from the federal government, discount in levies and readability on pending points to ease the monetary burden on the already burdened sector, based on scores agency ICRA.

The trade has been demanding a discount within the general costs paid by the operators primarily licence charge and spectrum utilization costs, ICRA mentioned in a pre-budget expectation word on Monday.

“The industry is also looking forward for a resolution on pending issues like clarity on levy of service tax on spectrum acquired in auctions prior to October 2016, one-time spectrum charges, resolution of retrospective taxation matters rebate on levy of withholding tax on mobile SIM distributors, and release of GST input credit dues,” ICRA mentioned.

The trade has been lengthy asking for elimination of the sector from the ambit of TDS (Tax on Direct Source) and elimination of telecom gear, particularly the 4G/5G gear, from the fundamental customs responsibility.

The Indian telecom trade has been dealing with headwinds by way of intense competitors and pricing stress, which along with the necessity for continued capex, have stored the trade saddled with elevated debt ranges, estimated at Rs. 5.zero lakh crore as on March 31, 2019, ICRA mentioned.

Moreover, with dismissal of evaluate petition of telcos by Supreme Court on AGR payout, the Government intervention is essential to safeguard viability of current operators, guaranteeing continued investments in expertise and spectrum in addition to stop any cascading affect on ancillary sectors and monetary system.

Fiscal incentive schemes for driving home improvements and indigenous manufacturing in addition to selling the event of ecosystem across the new applied sciences like synthetic intelligence, machine learning, and so on needs to be regarded upon. Further, steps to spice up infrastructure in rural and distant areas ought to stay in focus, with stimulus on rising broadband penetration, ICRA mentioned.

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