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Reduce GST on mobile phones to 12%, ICEA writes to state CMs


New Delhi: The India Mobile and Electronics Affiliation (ICEA) stated that it has written to varied state chief ministers to scale back the GST charges on cell phones to 12 per cent and on cell elements and parts to five per cent.

The 12 per cent GST rate on mobile handsets had elevated tax by nearly 50 per cent on this sector from a prevailing nationwide common fee of 8.2 per cent (pre-GST period).

The cell business was rising from the GST fee hike and the federal government as soon as once more elevated the speed by one other 50 per cent (from 12 per cent to 18 per cent).

“This enhance within the GST fee has a trickle-down impact resulting in the rise in costs for the patron, which, in flip, is lowering the demand for cell phones,” the ICEA stated in an announcement.

Additional, the transfer is proving to be a deterrent to the ‘Digital India’ initiative, as the prevailing excessive value of smartphones amplifies extra because of the enhance in GST fee,” the business physique lamented.

The ICEA, in affiliation with Ernst & Younger (EY), additionally launched a report, titled a consequential GST step: Boon or Bane for Cellular Handset Trade?’, that underlines the significance of cell phones within the present financial setting and taxation legal guidelines relevant on cell phones.

“This report captures all of the focal factors for policymakers that spotlight the rise in GST charges of cell handsets and its elements and parts,” stated Pankaj Mohindroo, Chairman, ICEA.

“Affordability shall be key to India reaching a $80 billion dimension within the home market by 2026, and the GST charges will play an necessary position,” he added.

Mobile phone subscribers have crossed the one-billion mark, and the month-to-month gross sales of cell phones have persistently been between 20-27 million in numbers.

“The charges for cell phones and elements have to be rationalised, and as highlighted on this report, introduced again to 12 per cent on the cell phones and concurrently eradicating the inverted responsibility construction,” stated Bipin Sapra, Companion, EY.

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