Telecom companies will not get input tax credit refund as the Goods and Services Tax Council (GSTC) will decline any such requests, said Bihar Deputy Chief Minister Sushil Kumar Modi. The input tax credit means reducing the taxes paid on inputs from taxes to be paid on output. It is the credit manufacturers get for paying input taxes for inputs used in the production of goods.
The (input tax) credit claim by the telcos is Rs 36,000 crore on inputs such as the equipments used to offer telecom services. The refusal by the GSTC will dash the hopes of any financial aid for the troubled telecom sector.
"The GST Council has not considered this issue and even if it does come up for consideration, it will not be accepted," Modi told ET. "And such a huge amount, there is no question of refund," added Modi who is also the convener of the Group of Ministers on Integrated GST.
Telecom companies have been goading the government to refund the input tax credit or adjust the refund amount against their statutory dues. They have also send repeated requests to the Finance Ministry in this regard.
The ministry currently has the input tax credit worth around Rs 18,000 crore for Reliance Jio Infocomm, roughly Rs 10,000 crore for Bharti Airtel and nearly Rs 8,000 crore for Vodafone Idea, the report stated.
The telecom service providers have been requesting the telecom department to push their case with the finance ministry and the GST Council. They had also raised this demand during the pre-budget meets last week. But the (GST) Council will not give its consent to any such refund relief, Modi said.
"There is no discussion on it. Such a request will not be entertained at all within GST Council, at any level," he told the news agency. Which news daily.