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Telecom operators on Tuesday (January 13) have written to the Union Finance Ministry, flagging licence fees as a major financial burden on the sector, and have sought multiple relief measures in the upcoming Union Budget.
The telcos have argued that high statutory levies continue to strain balance sheets and limit the sector’s ability to invest in networks. In their representation, the companies have sought rationalisation of licence fees, proposing a sharp reduction from the current 3% of adjusted gross revenue to a range of 0.5-1% of AGR.
The telcos have also asked for a pause in contributions to the Digital Bharat Nidhi, which currently stands at 5% of AGR. Another key demand relates to indirect taxes. Telcos have sought a waiver of goods and services tax on regulatory payments, including licence fees, spectrum usage charge and spectrum payments.
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The operators have further requested permission to use the input tax credit to discharge GST dues payable on licence fees and spectrum usage charges. In addition, the telcos have sought a recalibration of spectrum pricing and assignment models.
Last year, the Department of Telecommunications proposed one-way spectrum sharing among telecom operators that will enable service providers to monetise and optimally deploy unused radio waves, according to a draft notification. Earlier, operators were allowed to use spectrum in the same frequency band on a shared basis after approval from the government.
As per the illustration given in the latest draft rule, a service provider holding frequencies in a different band can share them with other operators having spectrum in a separate band but within the same category and telecom circle.
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Industry experts said the move will help operators like Vodafone Idea and BSNL to unlock their unused spectrum and monetise the asset. It will also help operators like Reliance Jio and Bharti Airtel to optimise their 5G services across circles.
Under the new rules, the DoT has proposed removing the limitation of sharing spectrum within the same band to category-level sharing, thereby providing telecom operators with options to optimally deploy unused spectrum of partner service providers for high-bandwidth services.
The telcos have argued that high statutory levies continue to strain balance sheets and limit the sector’s ability to invest in networks. In their representation, the companies have sought rationalisation of licence fees, proposing a sharp reduction from the current 3% of adjusted gross revenue to a range of 0.5-1% of AGR.
The telcos have also asked for a pause in contributions to the Digital Bharat Nidhi, which currently stands at 5% of AGR. Another key demand relates to indirect taxes. Telcos have sought a waiver of goods and services tax on regulatory payments, including licence fees, spectrum usage charge and spectrum payments.
Also Read: Noida International Airport launch nears, but telecom connectivity remains uncertain
The operators have further requested permission to use the input tax credit to discharge GST dues payable on licence fees and spectrum usage charges. In addition, the telcos have sought a recalibration of spectrum pricing and assignment models.
Last year, the Department of Telecommunications proposed one-way spectrum sharing among telecom operators that will enable service providers to monetise and optimally deploy unused radio waves, according to a draft notification. Earlier, operators were allowed to use spectrum in the same frequency band on a shared basis after approval from the government.
As per the illustration given in the latest draft rule, a service provider holding frequencies in a different band can share them with other operators having spectrum in a separate band but within the same category and telecom circle.
Also Read: COAI raises concerns over direct-to-mobile tech test by Prasar Bharati without engaging telcos
Industry experts said the move will help operators like Vodafone Idea and BSNL to unlock their unused spectrum and monetise the asset. It will also help operators like Reliance Jio and Bharti Airtel to optimise their 5G services across circles.
Under the new rules, the DoT has proposed removing the limitation of sharing spectrum within the same band to category-level sharing, thereby providing telecom operators with options to optimally deploy unused spectrum of partner service providers for high-bandwidth services.
