COAI writes to FM seeking relief for telcos amid corona crisis

New Delhi, April 2 (IANS) The Cellular Operators Association of India (COAI) has written to Finance Minister Nirmala Sitharaman seeking immediate relief for the telecom operators, including rationalisation of regulatory levies and liquidity support due to the adverse impact of the coronavirus pandemic.

“We request for refund of the unutilised input tax credit immediately. Else, we request that soft loan at MCLR rate should be given to companies, using the GST input credit as collateral,” the COAI letter said.

Urging the government to rationalise the burden of the regulatory levies on the telcos with immediate effect, the industry body sought reduction of the Spectrum Usage Charge (SUC). The effective rate of the SUC should be reduced by 3 per cent for all the TSP, it said.

Further, it also said that the licence fee contribution should be immediately brought down from 8 per cent to 3 per cent.

The COAI, in its letter also said that the telcos should be exempted from the levy of GST on license fees (LF), spectrum usage charges and payment of spectrum acquired in auctions.

“Exempt service tax on amount of LF/SUC payable by telecom operators in compliance with the Supreme Court order,” it added.

Outlining the issues faced the market players, COAI said: “On behalf of telecom service providers i.e Bharti Airtel Ltd, Reliance Jio and Vodafone IDEA Ltd, we wish to highlight that in the current situation, despite the outbreak and spread of the Covid-19 pandemic across the country, telecom companies are playing a critical role in addressing the challenges faced by individuals, corporates, governance services, emergency and utility services etc.”

Ensuring continuity of these services is of utmost importance in these challenging times, it added.

In the last few days, the load on the Indian telecom networks has seen an exponential surge, primarily driven by ‘work from home’ and extensive usage of telecom networks by all government agencies and private companies to remain ‘virtually connected’ due to lock-down, it said, adding that telecom service providers have invested and will continue to invest significantly in the telecom infrastructure (CAPEX and OPEX) and it has enabled to meet the increased demand for telecom services.

It noted that there has been a severe disruptive impact on the global supply chain, demand and supply elements and most importantly, on the cash flows of the companies due to the slowing economic activities and this downturn will have an impact on all payments including those of employees, interest, loan repayments and taxes.