Budget 2017 Telecom firms to seek relaxation in special audits

first_imgAs part of the budget wish list, telecom firms are planning to seek relaxation in special audits of their accounts ordered by the government in March this year to find out instances of underreporting of revenues.The Cellular Operators Association of India (COAI), which represents companies like Bharti Airtel, Vodafone India, Idea Cellular and Reliance Jio Infocomm, will raise this issue with the finance minister in the upcoming pre-budget consultative meeting, according to a report in the Economic Times.”Provisions related to special audit should be relaxed and triggered only in exceptional circumstances, with an ‘ease of doing business’ perspective,” the report quoted COAI as saying.A Comptroller and Auditor General of India (CAG) report in March this year found out underreporting of adjusted gross revenue (AGR) to the tune of Rs 46,045.70 crore from 2006-07 to 2009-2010 by telecom firms. This had led to a loss of Rs 12,488 crore to the national exchequer. Subsequently, the government had ordered special audits of the accounts of Bharti Airtel, Vodafone India, Aircel, Idea Cellular, Tata Teleservices and Reliance Communications to examine the issue.According to the report, telcos will also seek clarity on service tax on the spectrum, which has been imposed effective from 2016-17. “Operators feel that to ensure a uniform tax practice, the government should not impose service tax on the spectrum that was allocated in 2015 or before but assigned on or after April 1, 2016,” the report said.In the consultative meeting, telcos are also planning to raise the issue of imposing withholding tax on discounts extended to pre-paid distributors and retailers. “Distributors and retailers are not the agents of telecom firms and the discount offered to them cannot be taken as a commission for services on which tax is then levied,” the report quoted Rajan S Mathews, director-general of the COAI, as saying.last_img

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