Your Internet access will soon become costlier than you are paying now as India Government has decided to levy a uniform licence fee as 8% of “Adjusted Gross Revenue(AGR)” on all Internet Service Providers. The process has already started in phased manner, in two steps which started on 01.07.2012 . The extra tax will be levyed from both state owned service providers (which includes BSNL and MTNL) and Private service providers (mainly Airtel, Asianet, Reliance ISP, Tata etc).
The cost of accessing Internet is not fixed by the Government. The tariff for internet services are governed by the Telecom Tariff Order(s) issued by Telecom Regulatory Authority of India (TRAI) from time to time. According to India Govt press release “The decision for imposing Uniform Licence Fee for various Telecom Service Providers was taken in the interest of ending arbitrage in the licence fee, ensuring simplicity and transparency, expanding licence fee base and ensuring a level playing field between different services, with due consideration of the revenue receipts of the Government and the growth of Telecom services in the country.”
As Government levying the uniform licence fee of 8% as AGR, private operator Bharti Airtel ISP has already hiked the broadband rentals. Airtel has hiked the rental rates on its broadband DSL plans for both existing and new users. Airtel is alerting its customers on the rental hike through SMS and Call. The message reads “This is to inform you that due to regulatory changes and increased input costs,there is a marginal increase in the monthly rental for your airtel broadband bill plan.” Currently rental increase ranges from Rs 50 to Rs 150, depending on the current user DSL plan.
It’s likely that other ISPs will soon follow Bharti Airtel’s path and increase the broadband rates, making the Internet access in the country more costlier. What to do you think about Govt decision on levying this extra tax on ISPs, do comment your views.