Vodafone CEO Opposes Any Change In Mobile Termination Charges

Vodafone CEO Sunil Sood said there should not be any change in mobile termination charges as it will hurt the companies’ ability to provide services in rural areas.

“When we put up a site in village, the profit from that site is completely dependent on incoming calls,” he said after the Annual General Meeting of the Cellular Operators Association of India. “The earning of incoming calls depends on mobile termination charge. Any tweaking in MTC can cause all rural India sites to collapse.”

The telecom regulator had floated a paper last year proposing lower termination charges. The operators have been opposing the move.

Spectrum usage charges are already higher in India than the rest of the world, Sood said, highlighting concerns of the sector.

He also pitched for subsuming levy on licence fee into the Goods and Services Tax since telecom services will be taxed at a higher rate. GST on mobile services has been fixed at 18 percent, compared to the existing rate of 15 percent.

Excise has been abolished for electronics manufacturing sector and firms only need to pay a consumption tax in form of GST. “The GST on telecom sector must subsume licence fee of 3 per cent and we should have only one final consumption tax of GST,” he said.

Meanwhile, the COAI re-elected Bharti Airtel Ltd. Chief Executive Officer Gopal Vittal as chairman and Sood as vice-chairman.