Well, the Department of Telecommunications’ (DoT) try and effort to impose a fee the on-going growth on the utility of the internet services has been uplifted well with the industry. Displeased with the Internet service providers at a hike in the fee of annual licence, the industry body Internet Services Providers Association of India (ISPAI) reported on Thursday saying that it is likely to draw near to the Telecom Disputes Settlement Appellate Tribunal (TDSAT), making challenges to the latest fees.
Rajesh Charia, president of ISPAI said “We will file a petition at TDSAT for quashing DoT’s move to levy additional charges on ISPs. This is a disaster. An increase of seven per cent of the annual licence fee would have a cascading effect and would lead to an effective fee of 21-28 per cent as smaller ISPs would be taxed multiple times.” The department has made decisions to charge a 4% licence fee on the Internet Services Providers from this month itself as the service providers were not paying any licence fees.
According to a draft of the revision to the licence fee “A uniform licence fee of eight per cent of the adjusted gross revenue shall be adopted for all ISP and ISP-Internet Telephony (IT) licences, in two steps starting from July 1.” At the same time, the ISPs not having IT are enforced to pay 4% from the present zero payment from now onwards. This fee on Internet Service Providers with IT will be hiked to 7% from the present 6%. But, both will have to pay a licence fee which is equal to 8% of the adjustment made to the gross revenue and this will be on in action from the 1st of April, 2013.
This action will also enhance the charges of the utility of Internet for the end-users because service providers are likely to pass on the additional cost to their consumers. Even if Airtel reported that they did not find any sudden raise in tariffs, the other service providers have expectations that charge is to be passed on to the customers. Founder-chairman and chief executive officer of Net4, Jasjit Swahney said “Over the last few years, the prices of broadband have come down by 20-30 per cent on an average. The benefit of this has been passed on to the customers. If the government levys a licence fee, then that, too, will be passed on to the customer. You should also realise that this business has a very thin margin. A lot of us have frankly no other option.”