The Cellular Operators Association of India (COAI) urged the government for a reduction in licence fee to 1% in its budget wishlist, and it requested remission of customs duty on network equipment for the rollout of 5G as well as the elimination of the Universal Service Obligation Fund, or USOF.
Further Information Regarding the LF Cut
According to a PTI report, the COAI requested the elimination of GST on licence fees, spectrum usage fees, and payment of spectrum acquired in auctions at the pre-budget meetings conducted on Monday. The government has been urged by the top telecom association to rationalise GST, lower the licence cost from three percent to one percent, and waive customs taxes on 5G network equipment. The association also asked for clarification over the availability of input tax credits for crucial equipment installed on telecom towers as well as a return of the GST’s accumulated input tax credits, totalling Rs 32,000 crore. The COAI on Tuesday made a compelling case for OTT (over-the-top) communication services to pay telcos directly for the data traffic they are putting onto the networks, and it promoted a licensing and light-touch regulatory structure for such services. WhatsApp, Signal, Google Meet, Telegram, and other comparable apps are examples of OTT communication services. OTT communication services should be clearly defined, according to COAI Director General SP Kochhar, who stated that the organisation has provided its recommendations as part of the draft telecom bill. He continued by saying that other details, such as the precise financial model for OTT communication services to pay telecom service providers, will be presented to the government later on as and when the complexities of the framework for light-touch regulation were considered.
