Internet usage charge is set to increase from next month. The Department of Telecom has decided to levy a 4 per cent licence fee on Internet service providers (ISPs) from July 1, which will be doubled to 8 per cent in April 2013.

A draft of the amendment to licence fee says "a uniform licence fee of 8 per cent of the adjusted gross revenue shall be adopted for all ISP and ISP-Internet Telephony (IT) licences, in two steps starting from July 1, 2012".

While ISPs (without IT) will have to pay 4 per cent from the current zero duty starting July 1, the fee on ISP-IT will be raised to 7 per cent from current 6 per cent.

From April 1, 2013, both will have to pay a licence fee equivalent to 8 per cent of the AGR. This levy will be reflected directly in the monthly bills for dial-up and broadband users. The move, based on the Telecom Commission's recommendation, is contrary to the Telecom Regulatory Authority of India's advice to introduce a uniform licence fee of 6 per cent across all communications services to remove any room for arbitrage in revenue-sharing.

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