When Reliance Jio entered the Indian market, a new revolution sees in the telecom sector. Jio made telecom services very affordable and all companies offered tariff plans at a cheaper price. But now once again the Indian Telecom Department is going to see a big change. But tell you that this time this change is going to prove to be bad, not good. A Supreme Court verdict has created a stir in the telecom sector. And it is going to have a direct impact on the general public. Vodafone Idea and Airtel have said that from December 1, they are going to make their plans expensive. Not only this, telecom users may have to pay a hefty amount on many services. In such a situation it becomes necessary to know why these companies are taking such strict decisions after making plans cheap.
First of all, let us tell you that at this time the Indian telecom industry is facing the biggest loss in history. This loss has fallen on the 15 telecom companies of the country. And now the common users will also have to bear the loss of the telecom companies. Vodafone Idea and Airtel have incurred huge losses with this change. It is told that while Vodafone Idea suffers a loss of 50,921 crores. Airtel has also suffered a loss of 23,044 crores. AGR is the name to shake the telecom companies
What Happens to Telecom
Adjusted gross revenue (AGR) means adjusted gross revenue. Adjusted gross revenue is a tax levy by the Department of Telecommunications. Which collects from telecom companies in exchange for usage and license-related services. All this controversy and the agonizing issue of telecom companies is with AGR itself. The controversy that has been going on since 2003 has been called off this year. On October 24, the Supreme Court changed the definition of AGR. The court has ruled in favor of DOT, ending the dispute. The court has ordered that all telecom companies will have to pay their full dues within 3 months.
What is dispute
The dispute about which services should be within the scope of adjusted gross revenue is 15 years old which has run since 2003. The demand of the telecom companies was that only the revenue receives on the licensed services should keep under the AGR. And the companies would only give the share received from it to the government. But the Department of Telecommunications said that all services related to telecom companies should cover under AGR and tax should be levied on them.
Now this situation was
Under the AGR, only income related to phone services was included earlier. That is, the companies used to pay the tax to the government according to the earnings of telecom companies from services such as selling SIM, calling, internet, message, ringtone, alert and roaming. Under the old definition, only a 5 percent spectrum usage fee and an 8 percent licensing fee were paid in adjusted gross revenue.
This new change
After pleading with the DoT, the Department of Telecom. The Supreme Court has decided that tax services will levy on the services received by the companies along with phone services under the Adjusted Gross Revenue (AGR). Not only this, under the new definition. The telecom companies will now pay tax to the government on the money received for selling their property and the money received from renting a property. They will all cover under the AGR from now on.
1,34,000 crores outstanding
The telecom department submitted its report to the Supreme Court in July, which included the names of 15 telecom companies. The list also included the names of the existing companies of India as well as the telecom companies that have worked in the Indian market during the past years. In this report, the DOT gave a complete account of how much revenue own to which company. At the same time, after the Supreme Court in October, these telecom companies will have to pay this amount.
The 15 telecom companies on the list will have to pay total dues of Rs 1,34,000 crore. Of this amount, 93,000 crore rupees only license tax, fine and interstate amount. While 41 thousand crore rupees will have to be paid in exchange for spectrum usage. According to this report, Vodafone Idea and Airtel have to pay Rs 80,000 crore to the government. At the same time, Anil Ambani’s R Com will have to pay Rs 20,000 crore. And Tata Teleservices will have to pay Rs 13,000 crore as revenue.
Fear in telecom companies
Vodafone company CEO Nick read had also said after the Supreme Court order that the company would no longer invest in India. But after criticism later, Nick clarified and apologized to Prime Minister Modi, saying that his statement was misrepresented. At the same time, the Birla Group of Idea, a partner company of Vodafone. Has said that they do not have the money to pay the fees, now they cannot invest more.