| Govt may settle for 6% telecom revenue share |
| RUN UP TO BUDGET 2006 |
| Joji Thomas Philip / New Delhi January 28, 2006 |
| Telephone calls might become cheaper after the Budget because the finance ministry favours a cut in the revenue telecom companies have to share with the government to a flat 6 per cent. The companies now pay the government 10, 8 and 6 per cent, depending on the markets they operate in. This will be in line with the licence fees paid for long-distance telecom services, which were slashed this month from 15 per cent of revenue to 6 per cent. The Budget is also likely to redefine the revenue of telecom companies to weed out income streams not related to telecom services, like offering free handsets, a common practice in the West. Telecom companies in India are now taxed on handset sales. According to government sources, the finance ministry might also exclude from shared revenue interest and dividends from non-telecom investments, sale of assets and capital goods, and income from shared infrastructure leased from a third party. |
