The All-Kerala BSNL Franchisees Association has protested against the decision to deduct tax at source on the sale of mobile recharge coupons, SIMS etc, saying this would adversely impact the profitability of BSNL retailers.

Mr Francis Mukkanikkal, President of the Association, said in a statement issued here that the other service providers in the State are currently not deducting any tax at source on their sales of these merchandise.

The average margin of profit of the retailer is currently 4 per cent and the TDS will be in the region of 0.4 per cent to 0.8 per cent.

With this move, the Association feared that the retailers will eventually lose interest in BSNL products and the consumers may opt to migrate to other service providers with the number portability now in place.

The decision will impact BSNL and their franchisees in the State as they would also have to deduct tax at source at the rate of 10 per cent from the PAN card holding retailers and at the rate of 20 per cent from the non-PAN card holding retailers, he said.

Besides, the franchisees will be required to file the details of the retailers and remit the TDS thus collected on a regular basis which would necessitate additional manpower. The franchisees are operating on a meagre profit margin of 0.5 per cent to 1 per cent, and any additional cost input to them would impact their profitability, he added.

The association also requested the Union Government to intervene and find a lasting solution to the issue.

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