The Department of Telecom has sought sops from the Finance Ministry to revive the telecom sector. This includes extension of tax holiday for new investments in creating infrastructure. The telecom department has also asked the Ministry to let telecom companies avail of viability gap funding, like other infrastructure sector companies.
Telecom companies that started operations between 1995 and 2004 have been given a 15-year tax holiday under section 80 IA of the Income Tax Act. DoT has urged the Finance Ministry to remove the sunset clause, and extend the benefit to companies that are making fresh investments in infrastructure.
“The existing provision has a sunset clause, which will result in denying 80 IA benefit to new licences as well as to those who roll out 3G and LTE services,” the DoT said in its proposal.