Tax arrears dispute disrupts internet across the country

The government has stopped the payment of 3 billion rupees for the purchase of 'bandwidth' that Nepal's service providers have to pay to Indian companies for non-payment of taxes.

Baishak 21, 2081

Sajana Baral

Tax arrears dispute disrupts internet across the country

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Indian companies have cut off the internet of internet service providers in Nepal after the payment for the purchase of 'bandwidth' has been stopped for nine months. After the internet was cut off, the internet provided by Nepal's leading 'fixed broadband' service provider has become blocked or extremely slow since Thursday afternoon.

After the Indian 'upstream' provider cut the link to Nepal, the internet service providers (ISPs) of Nepal only informed the customers that the internet was blocked, but the dispute is related to the tax arrears of the maintenance fee claimed by the government. On Thursday evening, the Ministry of Communication and Information Technology, through a statement, took the stand that the fee collected in advance from the consumers must be submitted to the government according to the law.

For some time now, ISPs in Nepal have been warning that the internet service could be cut off at any time because they could not pay the amount for the purchase of 'bandwidth' to the Indian company. At present, the network of major service providers like Worldlink, Subisu, Vianet, TechMinds is not running. 

'We didn't think that the internet would be cut off like this, but it was cut off,' said Vinay Bohra, Managing Director of Vianet Communications, 'Airtel Bharti has cut off the internet after not being able to pay the amount of bandwidth. He is looking for assurance that he will get the money. The government should facilitate the recommendation of foreign currency.' Bohra said that the company had written to Airtel on Thursday to restore the Internet, saying that its 250,000 customers were upset.

ISP Worldlink, which has the largest number of customers in Nepal, has also informed Kantipur that about 70 percent of its services have been disrupted. The company has said that it could not send the amount of the 'bandwidth' purchase to the 'upstream' provider as it could not get foreign currency matching facility on the social network platform. 

'We have repeatedly requested the government to provide recommendations, we even showed the warning letter sent by the Indian company to the Ministry of Communications and the Telecommunication Authority, but the government did not take it seriously,' said a senior Worldlink official, 'After the internet was cut, our credibility, business were all affected. has been This is a big loss for us.' 

Just a few days ago, the Internet Service Providers Association (ISPAN), the umbrella organization of Internet service providers, held a press conference and informed that about 3 billion rupees for the purchase of 'bandwidth' for the past 9 months has yet to be paid.  The internet has been shut down,' said Subhas Khadka, Chief Executive Officer of Ispan, 'call centers of service providers are receiving so many calls, it is difficult for us to handle them. There is nothing we can do about it.'' He said that after the internet was slow and blocked, customers increased their search policy.

For some time now, there has been a dispute between the government agencies and the service providers regarding the outstanding dues with the ISPs. The government has taken the stance of withholding foreign exchange until payment of the Rural Telecommunication Development Fund (RTDF) and royalty for the maintenance fee. The ISPs have been arguing that the maintenance fee is not directly related to telecommunication services, so they should not pay that amount. Both the government and the ISP have been explaining according to their own interpretation whether the maintenance fee is included in the telecommunication service or not based on the clarification of Rule 26 of the Telecommunication Regulation, Section 5 of the Rural Telecommunication Development Fund Regulation 2068 along with the amendments to those laws and the decisions of the government on various dates. 

The controversy started when the then Prime Minister KP Sharma Wali government decided to impose 13 percent telecommunication service fee on Internet services through the Economic Act in 2075. After that, based on the discussion between the ISP and the government and the recommendations of the price adjustment committee, it was agreed to adjust the fee so as not to burden the consumers financially. Accordingly, the government, under the leadership of the Ministry of Finance, decided to levy up to 50 percent of the total fee for maintenance and not to charge telecommunication service fee.

service providers have been claiming that the same decision, court orders, provisions made by the revised Telecommunication Regulations and the Financial Act, the reports of the Public Accounts Committee have said that royalty and RTDF will not be charged for maintenance. In this regard, in the case filed by Worldlink in the Supreme Court, an interim order was made on June 9, 2077 not to implement the provision regarding the collection of royalty and RTDF until the case is resolved. The ISPs say that they are ready to follow the court's order and that they have a hearing on this matter next Monday.

According to ISP, 70 percent of international bandwidth comes from Bharti Airtel in Nepal. Sudhir Parajuli, president of ISPAN, said in the program that the contract with the company is about to be invalidated due to the terms related to non-payment. "We have not been able to pay because the government has not recommended the foreign currency rate," he said. Service providers must obtain approval from the Ministry of Communications and the National Bank through the Telecommunications Authority to receive foreign currency referrals.

When trying to get a response about the internet service of nearly 80 million users being blocked, Communications Secretary Ramakrishna Subedi suggested 'not to ask yourself about such matters' and to seek answers from the spokesperson. After the transfer of joint secretary Netra Prasad Subedi to the Ministry of Home Affairs, the Ministry of Communications has been without a spokesperson for a few days. Vishal Sapkota, Assistant Spokesperson of the Ministry responded that the Ministry has not stopped the matter recommended by the Nepal Telecommunication Authority and that this matter is the jurisdiction of the Authority.

In the statement signed by Sapkota, it is mentioned that out of total 122 Internet and 23 network service providers, all are paying the fee according to the rules and the foreign currency of the service provider paying the fee is being paid according to the rules. "There is a situation where the Telecommunication Authority has been requesting the service providers time and time again," the statement said, "everyone is requested not to do anything to disrupt essential services like the Internet." They said that they are in the process of understanding about yes and will make it public after the official opinion is made.

Sajana

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