Telecom companies won’t get input tax credit refund: Sushil Modi

NEW DELHI: The Goods and Services Tax Council will reject requests by telcos for a refund of input tax credit of Rs 36,000 crore, Bihar deputy chief minister Sushil Kumar Modi told ET, dashing hopes of any financial relief for the beleaguered telecom sector.“The GST Council has not considered this issue and even if it does come up for consideration, it will not be accepted,” said Modi, the convener of the Group of Ministers on Integrated GST. “And such a huge amount, there is no question of refund.”Telecom service providers have been urging the government to refund the input tax credit or adjust the amount against their statutory dues. They have sent several requests to the finance ministry.Input tax credit worth some Rs 18,000 crore for Reliance Jio Infocomm, about Rs 10,000 crore for Bharti Airtel and roughly Rs 8,000 crore for Vodafone Idea is currently with the finance ministry. The telcos are seeking a refund of taxes paid on inputs such as equipment used to provide telecom services.Bharti Airtel and Vodafone Idea are raising funds to pay about Rs 89,000 crore of adjusted gross revenue (AGR)-based dues to the telecom department.73023500 Licence fees and spectrum usage charges that have been pending for more than 15 years because of a legal dispute over the definition of AGR need to be paid by January, as per a Supreme Court order. Adjustment of input tax credit refund against the dues would have helped the telcos struggling with losses and debt.The telcos have been asking the telecom department to push their case with the finance ministry and the GST Council, the nodal body authorised to take decisions in the matter. The demand was also raised with the finance ministry during pre-budget meetings last week.However, the Council will not concede any such relief, Modi said.“There is no discussion on it. Such a request will not be entertained at all within GST Council, at any level,” he reiterated.Only in one case has exemption on GST been given — on the langar at Swarn Mandir of Amritsar — and Rs 300 crore refunded, where the Central government reimbursed it, otherwise there has been no case of exemption or refund, Modi explained.

from Economic Times https://ift.tt/2u5iLel
via IFTTT