Elon Musk’s Starlink likely to face spectrum tax

NEW DELHI: Starlink is likely to face a spectrum tax in India, which had been abolished for terrestrial community suppliers, equivalent to Reliance Jio, Airtel and Vodafone Idea a number of years again, sources mentioned. The tax, if imposed, will enhance service prices for Elon Musk-run satcom enterprise in India.
The transfer might be one other problem for the American satellite tv for pc main, which is negotiating stiff compliance mandates associated to web suspension and interception. .
Sources informed TOI that Starlink, which might be allotted telecom airwaves by way of administrative allocation (in step with the brand new Telecom Law handed in Dec 2023), will want to cough up round 3% spectrum utilization cost (SUC) on its adjusted gross income from the nation.
“Since spectrum will be ‘administratively assigned’ to satellite operators instead of auction, SUC will be applicable, for which final rates are being worked upon,” one of many sources mentioned.
This will imply that aside from 8% licence charge, that every one telcos want to pay, satcom gamers might be required to shell out an extra cost for spectrum. “It may even be higher than 3%, though this is still being discussed.”
The matter associated to the pricing of satellite tv for pc spectrum, its tenure and different taxation is presently being finalised by regulator Trai. “Discussions within Trai are believed to have come to the conclusion that there is a requirement to mandate SUC for satcom players, since they will be allotted spectrum administratively at a pre-determined price,” the supply added.
Trai is likely to submit its suggestions on the problem of satcom spectrum allocation quickly, and these will then be thought-about by the division of telecom (DoT). After evaluation of the suggestions, DoT could increase additional queries on the matter with particular references. Once happy, DoT will take up the matter with the inter-ministerial Digital Communications Commission (DCC). After DCC’s approval, it is going to be taken up by the Cabinet.
In June 2022, govt had taken a call to take away SUC for bandwidth that had been auctioned after Sept 15, 2021 throughout completely different frequencies.
Sources mentioned SUC may also be relevant for different satellite tv for pc operators, equivalent to Eutelsat One Web (the place Airtel promoter Sunil Mittal has a stake) and Reliance Jio-SES (satcom JV between Jio Platforms and Luxembourg-based SES).