The telecom industry is reportedly preparing to urge the Centre to reduce goods and services tax (GST) on telecom services from 18 per cent to 5 per cent. They argued that telecom is now an essential service, and lowering GST would bring relief to consumers by reducing their mobile and broadband bills, when broader GST reforms are expected.
Further, executives will soon formally write to the government, noting that nearly 30 per cent of the sector’s revenues go towards taxes and levies, including licence fees and spectrum usage charges. They have long pressed for GST reduction, arguing that telecom is a necessity, not a luxury.
Before GST, telecom services were taxed at around 15 per cent, but were later placed under the 18 per cent slab despite industry lobbying for 5 per cent. Now, with the upcoming two-slab GST structure (5 per cent and 18 per cent), telcos are hopeful their case will be reconsidered.
