GST Won’t Increase The Prices of Smartphones : Vendors

Today is a historic day with respect to Tax reform. From 1st July 2017, 12 AM Midnight, The GST rule is active all over India and people are still wondering about its advantages and disadvantages. The point which we are discussing here is about the GST effect on the Indian Smartphone Industries.


Top smartphone vendors Samsung, Xiaomi, Oppo, Gionee, Intex and Lava have assured the smartphones’ pricing will not be impacted once the Goods and Service Tax (GST) rolls out in the country. However, new phone models may increase by 4-5 percent after the GST rate was fixed at 12 percent.

“There will be no impact on pricing,” said Gionee managing director Arvind Vohra. “Currently there is a differential tax in the market — in some markets you will give (tax) while in rest you will get it,” he said, indicating that in areas where GST will lead to higher taxes, companies like Gionee will absorb it.

Smartphones should also get cheaper as the current tax incidence on them is more than 13.5 percent, while the proposed GST rate is 12 percent. However, retailers are hesitant to stock up new products in the first few weeks of July due to initial market fluctuations GST on Smartphones would cause.

China’s Xiaomi and Oppo and Indian handset maker Lava, too, said they won’t change their prices after GST rolls out on July 1. This is to help consumers purchase the company’s products, said Gaurav Nigam, head of products at Lava International.


Overall there is not much disruption made by GST in the Indian Smartphone Industries and will hope for more better and transparent Tax system with the massive roll-out of GST in India.