The Cellular Operators Association of India (COAI) has submitted its recommendations for the 2012-2013 Union Budget to the Ministry of Finance.
The key recommendations include:
CENVAT credit of central excise duty be made available to towers and shelters
To exempt from service tax the earnings of distributors from distribution of telecom services
Appropriate clarification on the applicability of service tax in Jammu & Kashmir, taking into account the General Sales Tax being paid on specified services in J&K, so as not to have dual levy of tax on services
OFC (Optic Fibre Cables), being a vital component of telecom infrastructure and a key one for the NTP 2012 objectives, should be classified under tariff chapter heading 85 attracting Nil rate of basic customs duty
Government should introduce a new section to deal with the case of deduction of tax at source by the telecom operators from the discounts offered to distributors
Since the requirement of quoting the PAN number at the time of taking a mobile connection, as per the Rule 114B(g) of the Income Tax Act becomes an inhibitor/hurdle for spread of service to low end / rural subscribers, the Government should delete Rule 114B(g) of the Income Tax Rules
There are several other recommendations made by COAI which focus on simpler and more efficient procedures for the industry and are targeted at effective utilisation of resources and policies to ensure holistic development and growth of the sector in line with the government?s vision as presented in the draft National Telecom Policy 2012. COAI is hopeful that due consideration would be paid to the recommendations submitted and a balanced approach towards the budget would be taken by the Minister.
COAI?s presentation to the Ministry of Finance is attached.
