Make in India: Govt might impose around 10% BCD on smartphones

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The government is close to imposing basic customs duty (BCD) of at least 10% on smartphones, which would make imported smartphones costlier, giving a major boost to the Make in India initiative.
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The step would also bring relief to companies like Foxconn and Wistron that have invested heavily in factories and plants in India. It would also stimulate investments of more than Rs 1,000 crore that have been waiting to get clarity regarding price differential incentive with India’s move to goods and services tax (GST).

Even though the current duty structure makes imported phones expensive than the ones made in India, but GST was set to balance it out.

As per officials from the ministries of commerce, revenue, and IT and electronics, the government might announce its final decision soon, even before GST comes into action on July 1st.

"There have been discussions... We would take a call soon," a finance ministry official told ET.

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As per two government officials who requested anonymity, the commerce department had recommended a duty of more than 10%, which is the present peak rate on smartphones, also suggesting duty between 10 and 20% on some other electronic products.

As per the present tax structure, imported smartphone are 11.5% costlier than India-made handsets, to boost local manufacturing. However, a 12% flat GST on mobile phones would have balanced the difference.
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