GST on mobile phones hiked to 18%

15/03/2020

Pankaj Mohindroo, chairman at India Cellular & Electronics Association, said the move to increase GST by 6% would be detrimental to the vision of Digital India.

“Consumption will be stymied and our domestic consumption target of ₹6 lakh crores by 2025 will fall short by at least ₹2 lakh crores,” he said.

In a letter to the Finance Minister earlier this week, Mr. Mahindroo said that instead of rationalising the GST on components and inputs, the “bizzare” move to increase the rate on the final product was not in the interest of consumers as well as the industry.

On the calibration of rates for other items where similar problems arise, such as footwear, textiles and fertilizers, Ms. Sitharaman said that after a detailed discussion it was decided to take up the matter at future meetings.

The GST rate on maintenance, repair and overhaul (MRO) services in respect of aircraft has been reduced from 18% to 5% with a full input tax credit.

“This change is likely to assist in setting up of MRO services in India,” she said at a press conference after the meeting.