Until recently, rental rates for the same radio-frequency resource (RFR) ranges differed by 65 times in Ukraine.
The amendments to the Tax Code developed on the basis of recommendations on the RFR provided by BRDO experts will restore justice. The amendments came into force on May 23 this year.
Experts of the IT&Telecom sector of the Better Regulation Delivery Office (BRDO) conducted a detailed market analysis presented in the Green Paper “How to use a radio-frequency resource to ensure quality communication in Ukraine?”.
Just imagine: in Ukraine, the rates for certain frequency bands were UAH 45.83, and for others – UAH 3,000. At the same time, all these frequency bands can be used for the latest radio technologies, in particular, 4G and 5G.
The amendments provide for an increase in the rental rate for these frequencies:
- in the amount of UAH 458.30 per month per 1 MHz radio-frequency bandwidth temporarily (until December 31, 2020 (inclusive);
- in the amount of UAH 3,000 per month per 1 MHz radio-frequency bandwidth from January 1, 2021.
According to our calculations, revenues to the state budget from paying for the RFR use will increase by UAH 236.3 million estimating at UAH 240 million in 2021. By the end of 2020, the state budget will receive UAH 21.4 million.
“If the companies owning the resources use the provided spectrum inefficiently, they will be forced to either pay an increased rent for the RFR use or refuse to use it,” the head of the IT&Telecom sector Ihor Samokhodskyi explained.
He added that in that case, the state would be able to direct the resource to those companies that are ready to act towards the development of new generations of communications in Ukraine and can pay rent for the RFR use.
This material is prepared by the Better Regulation Delivery Office (BRDO), an independent expert and analytical center funded by the European Union under the FORBIZ project and within the framework of EU4Business Initiative.