Dish TV writes to TRAI over concerns of high licence fee

Jawahar Goel, Chairman & MD, Dish TV India Ltd has written a letter to the Chairman of TRAI pointing out that the DTH industry is running into heavy losses due to multiple taxes

Dish TV TRAI

Direct-to-Home (DTH) service provider Dish TV has requested the Telecom Regulatory Authority of India (TRAI) to consider deduction of subscription charges from revenues for the purpose of calculation of licence fee paid by DTH companies.

In his letter to the TRAI Chairman, Jawahar Goel, Chairman and Managing Director of Dish TV India, has pointed out that the DTH industry is running into heavy losses due to multiple taxes. He has also sought support from the ministry and parity in treatment with respect to the competitors to minimise losses. He said this should be done in view of the recent notification of the Interconnection Regulations 2017 and Tariff Order 2017.

In 2014, TRAI had recommended that the licence fee payable by the DTH operators should be 8 per cent of the adjusted gross revenue (AGR), which will be calculated by excluding service tax, entertainment tax and sales tax /VAT actually paid to the government.

"The change in the position of Trai though was a shift from its earlier stand of payment of licence fee on AGR. However, it had been recognised that DTH players should be given some level playing field as compared to its competitors since the effective licence fee by this method would have almost remained the same as was in the case of 8% of AGR," Goel said in the letter.
Goel stressed in his letter that the notification of the tariff order substantiates that content fee “collected for and paid to the broadcasters” must be allowed as a deduction while calculating the DTH licence fee.

“With the implementation of the new regime, the role of the digital platform operator (DPO) shall become limited to the extent of a pipe/network through which channels/bouquets will be offered to the consumers….all the DPOs including DTH operators will act as mere collection agent of the broadcasters,” said Goel with regard to subscription charges. He added that therefore, subscription charges should be excluded for calculation of adjusted gross revenues for the purpose of levying licence fee.

"The broadcasters and DTH operator are one and the same. Both of them transmit the signal, though a satellite and make them available for the purpose of reception. In this aspect both stand in the same category and on the same footing. Therefore, subjecting DTH operator to licence fee while forbearing broadcaster and other distribution platform operators (DPOs) is discriminatory," said Goel. He has requested TRAI to issue necessary recommendations to the central government before it takes a final call on the terms and conditions.

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