Telcos to absorb telecom tower levy
Sri Lanka’s telecom companies say they are compelled to absorb the Rs.200,000 mobile tower levy imposed in the 2018 budget. The government’s aim of introducing this levy is to reduce the number of new towers mushrooming and proliferating countrywide, mobile operators said.
These companies will not pass their additional cost following the imposition of the new levy on mobile phone users, they added.
The government has introduced a tax on mobile phone towers to discourage their proliferation Finance Minister Mangala Samaraweera said adding that mushrooming of telecom towers is an environmental and health hazard as well.
More new towers have started mushrooming throughout the country raising the number of towers to 6750, a senior Treasury official told the Business Times.
Mobile operators in Sri Lanka are involved in cost-sharing of towers and land to reduce costs.
Although the Telecommunication Regulatory Commission (TRC) has introduced a national policy and guidelines on telecom towers, some of the service providers have failed to adhere to those guidelines and international standards, he disclosed, adding that only one tower is permitted within a radius of 500 metres. In some instances, the towers are susceptible to lightning strikes due to the failure to fix lightning protectors and proper system of earthen it due to high costs, thus exposing residents in the area to high risk, he added.
This was another reason for the government’s action to reduce the number of towers, he said.
The tower levy is unlikely to result in the quick consolidation of antennae to fewer towers because tower sharing is already happening and in most cases, mounting additional antennae on existing towers is not practically possible because of the weight they (or the underlying structures) have been designed to carry. The likely outcome is the shutting down of marginal towers, harming the quality of service in the cities and loss of service in some rural areas.
Fixing additional antennas on existing towers could be carried out to a certain extent as the framework of telecom towers cannot bear a heavy load beyond the stipulated weight limit, an experienced telecom engineer said.
In the 2016 budget, a proposal was made to impose a similar tax of Rs. 50,000 per telecom tower which is in force but has not exerted a major impact so far on the credit profile of major telecom companies SLT and Dialog. The 2018 budget has increased that fee to Rs.200,000 per month per tower.