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Telecom Commission delays imposing annual licence fee of 8% on ISPs

Telecom Commission

The Telecom Commission has postponed the proposal related to imposing an annual licence fee of 8% on the Internet Service Providers (ISPs). The commission has taken this decision in order to avoid the hike in internet charges which will in turn affect the government’s aspiring Digital India initiative. As reported by PTI, Rakesh Garg the Chairman for the Telecom Commission said that, the proposal needs to be discussed further as levying an annual fee may lead to a rise internet tariffs and charges.

On the other hand, DoT is also of the view that imposing a fee on ISPs could obstruct their efforts of connecting the entire nation with broadband connectivity under the Digital India project. However, TRAI has suggested that the government should levy 8% annual fee on the ISPs for their licences. Although, the government levies licence fee on AGR of telecom firms after deducting some components that are not earned from telecom services.

Earlier also the regulator has recommended that the government should impose 8% licence fee from April 1, 2013, but the same was deferred after the questions raised on revenue items that should be considered for calculating the final charges. Moreover, the industry body of the service providers said that, the move to increase licence fee on internet services will adversely affect its target to achieve 175 million broadband connections by 2017 and 600 million by 2020 as it will increase service tariffs.

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