GST: Mobile phones to get expensive; Talk time will decrease
The government has imposed the Goods and Services Tax (GST) Council at 12 percent for mobile phones thus taking away the benefit under duty differential that was being offered to local manufacturers. Under the new GST rate imported phones will become cheaper and most of the locally manufactured phones will get expensive.
Under the government’s Make in India push, around 80% of 59 million phones sold in India in the January-March quarter were made locally, up from 65% in 2016 when 265 million phones were phones.
GST is expected to be implemented from July 1. According to rates fixed by the GST Council on Thursday night, Telephones for cellular networks or for other wireless networks and parts for their manufacture will attract a rate of 12%. Talk time will also be reduced due to the new implementation.
For mobile phones imported and sold in India, duty was from 17% going up to 27%, which now comes down to 12%, giving imports a leg up. Prices of mobile phones at e-commerce players like Flipkart, Amazon, Snapdeal, Shopclues and others, where sellers of mobile phones have been supplying from low VAT states will now be higher than earlier.
