With just two cellular service providers and two key ISPs operating out of Karnataka, it is not clear to the industry if the professional tax is applicable per user or otherwise. Also, with each of the service providers vying hard to quickly expand their subscriber base, any tax per user could be a deterrent for the convergence industry. ``If it is per user Rs 2,500 is quite high and works out to Rs 200 extra per month for the user. However, if it is a single charge, the amount is hardly anything for the government. We are awaiting clarification on this,'' said Spice Telecom vice president marketing, sales and customer support, T Elango.

The industry is also of the understanding that the tax is likely to be levied on the dealers and retailers of mobile phones as part of the professional tax. However, the industry claims that either way it will adversely impact growth.

According to Airtel chief executive officer Jagdish Kini: ``As it is, the average revenues for mobile service providers are not high. If the tax is per user, close to 20 per cent of earning would go towards this and the consumer will not be happy to bear the charge.''

Explained Anup Verma, BPLnet,``Whether shared or otherwise, the burden will have to be borne by someone, which will stunt market growth.'' Wipro's ISP Netkracker CFO V Ganesh said, ``On an average, the Internet bill of Rs 1,500 per annum for a retail user, taxing at Rs 2,500 per year will be ridiculous."MAIT president Vinay Deshpande felt the introduction of professional tax on mobile service, ISPs, internet and information kiosks and e-commerce providers was too early as the sector was yet to attain critical mass. This could demoralise the sector and impact on the growth, Mr Deshpande added.