There have been complaints about the spectrum prices in India being high. But it is likely to go higher, as FM Arun Jaitley today announced the government’s plans to levy service tax on spectrum auctions. Jaitley today presented the Union Budget 2016-17 at the Parliament. Also Read - Government rolls back 29.44% import duty on mobile phone componentsAlso Read - Union Budget 2016-17: TCS and Wipro hail SEZ scheme extension, digital plans
Earlier this year, TRAI recommended reserve price of Rs 1,595 crore for 700MHz spectrums and Rs 554 crore for 2100MHz in the Delhi circle. Many, including the GSMA, are concerned over the steep recommendations for the spectrum pricing. Also Read - Union Budget 2016-17: Prices of modems, set-top-boxes and routers likely to go up
The likes of Telenor and Vodafone have expressed concerns over these recommendations, and also claim that it could affect investments in the country. “The pricing of spectrum should reflect the internal capital of the Indian market and the fact the tariffs are very low in India. If you set prices which are too high for spectrum, money is not going to go into investments. There must be a proportionate between cost for spectrum and the economic condition of the country, Vodafone Group CEO Vittorio Colao was quoted as saying.