New Delhi: In a bid to expand Internet usage, Mahanagar Telephone Nigam Limited (MTNL) in a pre-budget proposal has suggested a tax rebate for Internet usage. In a proposal submitted to the government on Wednesday the state-controlled Internet service provider has asked for tax concessions to be given to the subscribers on Internet subscriptions as well as the actual bill payments for Internet usage. Speaking to The Financial Express, MTNL's director (finance), Mr S Sundresan said: "We have made the proposal keeping in mind that making the Internet subscriptions tax deductible will encourage greater Internet usage." While MTNL itself has not specified any limits for which the tax concessions should be made, the government might however set limits upto which the usage might be qualified for tax rebate.Mr Sundresan added: "We, of course have suggested that the entire amount should qualify to be considered tax deductible." While encouraging Internet usage, the move will also generate revenues for the government, because there is a five per cent service tax on the total bill payments, added Mr Sundresan. There is no service charge on the Internet subscriptions though.
This proposal is only for the dial-up accounts, wherein the customers normally end up with hefty telephone bills for connectivity. Making this expenditure tax deductible is likely to help in increasing usage. Mr Sundresan hoped that "it will be specially beneficial for the students." Mr Amitabh Singhal of the Internet Service Providers Association of India (ISPAI), while concurring that the proposal would be a tremendous incentive for the subscribers, added that the industry's long-standing demand for the status of an infrastructure industry, (wherein there will be a tax holiday for the next five years) will also help the industry service its subscribers better.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
