GST on Mobile Phones Reduced in July 2023? Here’s What You Need to Know

The Ministry of Finance celebrated six years of the Goods and Services Tax (GST) in India. The official social media of the Ministry of Finance published an image highlighting the benefits of GST compared to the previous regime, where there were multiple taxes involved, which resulted in the cumulated value.

The screenshot highlights the difference in the tax value before and GST was introduced. One indicator that highlights the benefits of the GST is the lower tax on mobile phones. The timing of the publication created confusion among several users online, including some prominent, social media influencers, who celebrated the GST reduction on mobile phones. The image also shows GST on TVs, Appliances, etc.

But is this the case? Well, sorry to burst the bubble, but no. GST for mobile phones has not been reduced in India. Here’s why!

Mobile phones will not Getting cheaper in India from July 2023

At the time of GST implementation, the government set a 12 percent tax on mobile phones. Later, after the 39th GST Board meeting, the Government of India increased and fixed GST on mobile phones by 18% from 1st April 2020. Since then, smartphone companies have been paying up to 18% GST on mobile phones, which were transferred and taken from the consumer’s pocket. 

During the 2023 budget, the government reduced the goods and services tax on mobile phones, lowering it to 12 percent. However, consumers still have to see the same benefits like component pricing, logistics, etc. They are not affected due to external factors such as supply chain disruptions, the ongoing war between Russia-Ukraine war, and the fluctuating value of the Indian rupee against the US dollar.

This has led consumers to pay directly or indirectly. If the prices of the phones remain the same, they do not offer the same value in terms of hardware and features. Instead, phones featuring updated hardware over the previous model attracted much higher prices.

Conclusion

Overall, the GST on mobile phones remains unchanged at 12 percent. However, many users seem to have been confused by the latest post, which compared taxes during the pre-GST and post-GST eras.

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