The much-awaited GST Council meeting, chaired by Finance Minister Nirmala Sitharaman, began in New Delhi to discuss possible tax cuts across various consumer goods. However, smartphone makers are unlikely to benefit, as industry insiders suggest the 18% GST slab will remain unchanged.
Smartphone Industry’s Concern
According to sources from leading mobile manufacturers, there is little hope of a reduction to 5%. Even a shift to a 12% GST slab would have provided some relief, but discussions so far point towards the continuation of the existing two-slab structure with 18% intact.
Impact on Consumers
Unless the GST rate is cut, smartphone prices will not see any reduction, disappointing both manufacturers and consumers. The India Cellular and Electronics Association (ICEA) had earlier urged the government to lower GST on mobile phones and components from 18% to 5%, stressing that smartphones are essential digital tools for over 90 crore Indians.
Historical Context
The GST rate on mobile phones was raised from 12% to 18% in 2020. Before GST, most states categorized phones as essential goods under 5% VAT, making them more affordable.
Market Snapshot
India’s smartphone manufacturing industry is valued at ₹5.45 lakh crore in FY25, with exports projected to cross ₹2 lakh crore. Despite this growth, high GST continues to impact affordability.
Possible Relief
Industry experts note that some relief may come for domestic manufacturers, as the government pushes for greater indigenisation in smartphone production. Still, a broad GST reduction appears unlikely in the current reforms