Following the government’s decision to impose 13 per cent telecommunications service charge on internet service providers through the 2018-19 fiscal budget, ISPs are set to raise internet subscription fee for customers effective from July 17.
Similarly, telecom firms are also preparing to hike their charges for voice call owing to the government raising TSC for telecom service providers by two percentage points to 13 per cent.
“As ISPs are not in a position to bear the added financial burden from the new tax system, we will adjust internet cost accordingly, effective from July 17. Internet cost is bound to increase by almost 14 per cent,” Sudheer Parajuli, former president of Internet Service Providers’ Association of Nepal, told THT.
This means that cost for 15Mbps/month broadband internet package — the minimum internet package being provided by ISPs in the country — which costs almost Rs 1,000 now will rise by around Rs 150 from July 17.
Telecom firms, including Ncell, are also set to adjust new internet and voice call service charges for customers from the beginning of the new fiscal year.
“Internet fees will be raised by 13 per cent and charges on voice call service will also be raised by two per cent. This decision was implemented by Nepal government and will be applicable to our services soon,” Ncell mentioned in a tweet recently. Owing to increment in TSC for telecom service providers, telecom firms are saying that the cost of voice call service is likely to go up by three per cent.
Currently, telecom companies are offering voice call service at an average rate of one rupee per minute.
The government-owned Nepal Telecom is also planning to raise the cost of internet and voice calls. “We are yet to decide on this front,” informed Prativa Vaidhya, spokesperson for NT.
However, the new tariffs on internet and voice call service of telecom companies and ISPs need to be approved by Nepal Telecommunications Authority prior to their implementation. Meanwhile, ISPs have stated that the decision to impose TSC on internet services will not only add financial burden on customers but will prove to be a major setback for the growth of information and communications technology industry in the country.
Parajuli, who is also chief executive officer of Subsi CableNet, said, “At a time when the government is aiming to increase people’s access to internet and technology, increased internet cost will directly affect this plan.”
The government has been defending its decision to impose TSC on internet service, reasoning that people are increasingly using over-the-top services, such as Viber, WhatsApp and WeChat, for voice calls over traditional phone calls and messaging, thereby reducing the revenue from the telecommunication sector for the government.
NTA officials, however, added that imposing TSC on internet service does not necessarily require ISPs to increase internet fees.
“As international bandwidth cost is constantly coming down, ISPs can operate without increasing internet fee to make their services competitive,” Min Prasad Aryal, spokesperson for NTA, told this daily.
Aryal said NTA would allow ISPs and telecom companies to hike cost of internet and voice call services on the basis of its tariff guidelines.