From July 1, mobile phones, laptops and desktops are set to become expensive as the Goods and Services Tax will come into effect.
The Goods and Services Tax Council, chaired by Finance Minister Arun Jaitlely, has clubbed commodities under seven categories of tax— zero, 5, 12, 18 and 28 per cent.
The council has decided to keep laptops and desktops at a model rate tax of 18 per cent, compared with the current levy of 14-15 per cent, while other products such as printers and monitors will be taxed at 28 per cent.
Furthermore, most mobile phones may also get expensive by 4-5 per cent after the GST rate was fixed at 12 per cent.
The rate imposed by the council will cause locally manufacture devices to cost more, which currently enjoy low tax rates.
According to market researcher firm Counterpoint’s report, about 80 per cent of the 59 million phones sold in the country in the January-March quarter were locally manufactured.
Experts suggest that government will have to come up with incentives by July 1 to ensure government initiatives such as Make in India for contract manufactures like Foxconn remain in works.
