Spectrum Auction: GST will have to be paid along with spectrum fee installments, next round of auction on June 6
Spectrum Auction: Rajat Mohan, executive director of accounting and consulting firm Moore Singhi, said that under the GST law, spectrum payments fall under licensing services for the right to use other natural resources, which is taxed at 18 percent. Mohan said that spectrum charges have to be paid in a phased manner over a fixed period.
Spectrum charges must be paid by telecom companies in addition to GST. According to an official, telecom companies will be required to pay 18% GST on a monthly basis. The next round of the spectrum auction for eight spectrum bands used by mobile phone services will take place on June 6 at the Department of Telecommunications (DoT).
Rs 96,317 crore has been set as the auction's base price. In the next mega auction, the winning bidders will be able to pay in 20 equal annual installments for the 20 years that the spectrum will be allotted.
"The GST Council may clarify the process of GST payment by companies winning the bids during the spectrum auction in its next meeting," the official said. The clarification will eliminate confusion among field officers regarding the method of GST collection in the auction process.
Rajat Mohan, executive director of accounting and consultancy firm Moore Singhi, said under the GST law, spectrum payments fall under licensing services for the right to use other natural resources, which are taxed at 18 percent. Mohan said, 'Spectrum charges have to be paid in a phased manner over a fixed period. Thus tax payment will also vary. The Board of Directors should issue a clarification in this regard so that any litigation in this regard can be avoided.
