KOLKATA: Mobile phone operators are bracing for a possible hit on revenue following disruption in prepaid services as many distributors and retailers have been unable to complete mandatory registration formalities under GST by July 1.More than 90% of mobile phone users in India subscribe to prepaid services, which contribute over 80% to telecom operators’ revenue, executives said. This could have been avoided if the government had given more time, considering the massive load on the GST registration platform lately,” said Sanjeev Bahl, director (sales and marketing) at MTS India.Tax computation and collection under GST will be complex for prepaid services business where there are intermediaries such as distributors and retailers. Some distributors are indeed facing registration challenges,” said another senior executive on condition of anonymity. “Besides, a significant volume of prepaid business comes from multi-brand retailers, who front-end customers. This problem will not exist in the post-paid business, where there are no business intermediaries.

Source: Economic Times July 02, 2017 18:56 UTC