Abolish custom duty on all capital goods: Telecom industry

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New Delhi, Feb 24 (UNI) The telecom industry has asked for abolition of custom duty on all capital goods and raw materials and reduction of excise duty from 16 per cent to eight per cent, to make the products affordable for the consumers.

The industry also urged for scrapping Central Sales Tax (CST) for telecom equipment.

''We are of the view that a single taxation regime should be introduced to make the tax structure hassle free and investor friendly,'' said a telecom equipment provider.

The industry also pointed out that a complex burdensome tax structure has put them in disadvantaged position and has adversely affected competitiveness particularly with China.

Currently, there are variety of taxes and levies including 12 per cent service tax, six-10 per cent licence fee, two-six per cent spectrum charges, 1.5 per cent access deficit charge, three per cent education cess, one-two per cent bank guarantee of the government, besides customs and excise duty aggregating 26 per cent, which is more than most of the Asian countries.

Bharti Enterprises CEO Sunil Mittal said, in the service sector, telecom would expect dilution in the overall incidence of various levies, which cumulatively stand at a staggering 30 per cent of operator revenues.

''Such an initiative would help operators penetrate further into the rural hinterland and enable telecom to play a key role in the integration of the rural to the national economy,'' he added.

UNI MP/RT SG KN1446

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