Universal Service Obligation Fund (USOF) is the pool of funds generated by 5% Universal Service Levy that is charged upon all the telecom fund operators on their Adjusted Gross Revenue (AGR).
The USOF comes under the Indian Telegraph Act 1885. The act was amended in 2003 to give statutory status to the fund. The Department of Telecommunications, Ministry of Communications governs the fund and related provisions.
This fund is deposited in the Consolidated Fund of India and is dispatched on the approval of the Indian Parliament.
Aim: The aim of USOF is to provide a balance between the provision of Universal Service to all uncovered areas, including the rural areas.
Universal Service stands for universal, interdependent, and intercommunicating, affording the opportunity for any subscriber to any exchange to communicate with any other subscriber of any other exchange.
The Government of India kept Universal Service as an objective in its New Telecom Policy of 1999. It was through this policy that it was envisaged to levy Universal Access Levy upon the telecom licensees’ revenue in consultation with Telecom Regulatory Authority of India (TRAI).
Based on its genesis, the vision of the USOF is to provide affordable access to a reliable and ubiquitous telecommunications network through all rural Indians, which in turn help them achieve their fullest potential.
The USOF proposes to make its social, economic, political and constitutional objectives, which are as follows:
Bharat Sanchar Nigam Limited
Tata Tele Services Limited
Reliance Communications Limited
Vodafone
Bharti Airtel Limited, etc.
Recently, in their submission to the Finance Ministry for the Budget 2023, telecom companies are seeking the abolishment of the USOF levy and also the reduction of license fees from 3% to 1%.
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