Bharti Airtel seeks tax relief, deferred pay to fight Reliance Jio

NEW DELHI: Bharti Airtel is seeking relief from the government in terms of lower taxes and deferred payment for spectrum purchase. The appeal comes at a time when the company has reported a second successive quarter of decline in profit and has seen lower realisations from both voice and data operations — a fallout of steep competition from Reliance Jio.

“We need some rationalisation as the (telecom) industry is under stress,” Bharti Airtel India and South Asia CEO Gopal Vittal told analysts a day after the company reported a 72% decline in profit for the fourth quarter of 2016-17. “We are heavily taxed,” Vittal said, as he listed out a “bunch of levies” and taxes that telecom companies need to pay to the government, including licence fee and the spectrum usage charge (SUC).

The Airtel chief said a part of the relief can also come in the form of having a deferred payment mechanism for spectrum purchase. Older telecom companies have been reeling under heavy financial stress following the aggressive launch of Mukesh Ambani’s Jio, which began operations by offering unlimited free-voice calling and complimentary data downloads till March this year.


Jio’s disruptive pricing shook the business structure of competitors with Vodafone and Idea Cellular opting for a merger and Airtel complaining of “predatory pricing” by the new entrant. Vittal, however, said Bharti will continue to maintain an aggressive posturing to counter the Jio onslaught, despite pressure on profitability.