Telcos want to cap GST rate at 15% across India

Top telcos from the country have asked the government to introduce uniform rate across states and union territories (UTs), capping them at 15%, before finally going ahead with the goods & services tax (GST) regime.

As per these telcos, a rate higher than that would drive up cost of provisioning services, which would hurt both prepaid and postpaid consumers as they would have to pay more.

As of now, the circle boundaries are not synced with geographical borders of states/UTs in several cases. If this doesn’t happen, it could result in tax complications in some big markets because of differential rates within the same circle.

"We've recently told the finance ministry that it is imperative to have a uniform tax rate for telecom services across states/UTs, and a failure to do so could lead to a surge in consumer complaints as differential tax rates would impact the talktime pricing within a circle," Rajan Mathews, director general, Cellular Operators Association of India (COAI) told ET.

He added that COAI is working with E&Y India so that it can identify potential irritants in GST regime for telecom.

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