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India's Telecom Commission Rejects Attempts To Tax 3G,
by Mary Swire, Tax-News.com, Hong Kong
Monday, December 29, 2008
It has been revealed that India's telecoms commission has refused a proposal by the Telecoms Regulatory Authority to impose a 2% administrative tax on bids for bandwidth made by the country's 3G operators.
Under the TRAI's proposals, any companies winning 3G distribution in an
auction to be held in January 2009 would be levied an additional 2% administrative annual fee on their bid.
The Department of
Telecommunications (DoT) said that such a scheme would have a detrimental effect
upon the amount of capital raised from sales of 3G spectrum at the auction, and the telecoms commission therefore rejected the TRAI's proposal.
Earlier this month, the telecoms commission raised 3G operating fees to 3% from
the previous 1% on the advice of the government.
Under this decision, Indian operators who currently provide 2G services stand
to be charged anywhere between 3% and 8% on the total revenue made from their
services once they acquire 3G spectrum in addition to their existing 2G.
The 3G auction will take place on January 16, with applications to be made
after December 26.
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