TRAI changes ADC norms

By agencies   |   Friday, 24 February 2006, 08:00 Hrs
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NEW DELHI: Paving the way for a further reduction in long distance call tariffs, the telecom regulator TRAI has changed norms for a levy paid by private operators to BSNL, which may now suffer an annual revenue loss of $409 million.

Immediately after the announcement of the new norms, wherein the Access Deficit Charge on domestic traffic would be on revenue sharing basis instead of call duration, TRAI Chairman Pradeep Baijal said, "we are expecting tariff to come down following the new regime.

"However, we can't say by how much (it would drop) as tariffs are market driven."

Explaining rationale for lowering ADC on ISD calls (both incoming and outgoing), TRAI said this would result in reduction in arbitrage and hence the grey market.

One of the ILD operators, however, objected to double taxation for them as TRAI has included revenue from ILD traffic in the revenue, which has been taxed at the rate of 1.5 percent.

The regulator also exempted inclusion of revenue from rural operations of operators in the total earnings on which ADC has been levied at the rate of 1.5 percent.

The new regime would come into effect from March 1, this year.

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