Internet access gets costlier, Government decides to levy 8% AGR on ISPs

The government of India has decided to levy a uniform license fee as 8 percent of “Adjusted Gross Revenue (AGR)” on all Internet Service Providers (ISP) in phased manner. The uniform license fee has been levied in two steps starting from July 1.

Owing to addition of 8 percent extra tax through AGR, Airtel has already revised rates for its broadband DSL plans and will impact both existing and new users. Currently, it has increased the rental rates only for DSL users in range of INR 50-150. Apart from Airtel, other ISPs are also expected to raise the tariff in wake of AGR tariff.

According to the press statement, the decision for imposing Uniform Licence Fee for various Telecom Service Providers was taken in the interest of ending arbitrage in the licence fee, ensuring simplicity & transparency, expanding licence fee base and ensuring a level playing field between different services, with due consideration of the revenue receipts of the Government and the growth of Telecom services in the country.

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