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TRAI favours lower tax rate to boost mobile growth
TRAI chairman also said the Govt should reduce taxes to ensure higher growth in broadband.
Telecom Regulatory Authority of India has suggested that imposition of higher service tax should be avoided to boost growth of mobile telephony in the country.
TRAI chairman Pradip Baijal told reporters in Kolkata on Wednesday that taxes in India were the highest when compared to other developing countries like China and Pakistan and the Government should resort to higher taxation only after the mobile subscriber base touches the 100 million mark.
That would be the most effective measure to fuel growth in the mobile telephony sector, he said.
Referring to the consultation paper on Access Deficit Charge (ADC) circulated on the web on Wednesday, Baijal said TRAI was advocating scrapping the call-to-call regime in favour of percentage of turnover.
Baijal said that ADC was present in all parts of the world, though it had been transitory in nature. It was 30 per cent of total turnover, which was brought down to 10 per cent.
TRAI had suggested that ADC be at around two to three per cent, he said.
On implications of lower ADC, he said there would be downward pressure on tariff levels on both fixed line and mobile as the load would be distributed on both the types of operators.
Baijal said the idea behind unified licensing regime was to give a technology-neutral proposition to the subscribers as well as to bring in a balance between technology and service.
On the "portability" of mobile phone numbers, he said it was not high on TRAI's agenda at the moment. However, it had not been put on the backburner and would be discussed at a later stage.
Commenting upon broadband, he said India had the potential to achieve 20 million subscribers by 2010, out of which BSNL had the potential to provide 10 lakh subscribers by the end of this year.
Baijal said prices of broadband was 1,200 times higher than in Korea.
Fiscal policies were also responsible for poor growth of broadband in the country, he said, adding the Government should reduce taxes and duties to ensure higher growth in broadband.
