What are the GST Rates for Mobile phones, Smartphones and Accessories?

Last Updated at: March 16, 2020
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Latest Update

 

During the presentation of Budget 2020, the Finance Minister said that a simplified return format for GST is being introduced from April 2020.

What are the GST Rates for Mobile phones, Smartphones and Accessories?
What are the GST Rates for Mobile phones, Smartphones and Accessories?

 

The Goods and Services Tax was an initiative undertaken by the Modi government to bring most commodities sold in India under one major tax bracket. This would result in lesser calculations and more ease in payment of the tax. There have been several revisions made since the idea first rolled out and the public has readily accepted most of these changes while some were severely criticized. The finance department coordinated with the banking institutions to set a reasonable slab and the current GST trends look to be staying as each revision updates and betters the previous template. Here’s a look at the GST rate for mobile phones and their accessories.

GST (Goods and Services Tax) is an initiative taken by the government to bring all commodities in the country under a single tax bracket. This new tax initiative will result in fewer calculations and easier payment of taxes. Electronic gadgets such as smartphones and accessories also come under GST and here we have curated the details related to the same.

Get Your Business a GSTIN Number

Present Scenario

The present-day world has already declared smartphones as their primary concern, and with annual sales skyrocketing year after year, it looks like the trend is here to stay. Several small and medium level enterprises sell mobile phones and mobile accessories, and the industry is a booming one that is expecting even more growth in the years to come.

Mobile phones and mobile accessories in India is under Goods and Services Tax. The GST rate on mobiles is currently 12% irrespective of whether the device is a smartphone or a feature phone. The GST rate on electronic mobile accessories is 18%.

Why GST

Before the GST, VAT was the primary form of tax that was levied on the mobile phone, and as the VAT rates varied from state to state, it was difficult to fix a standard price for the phone. Under GST, the rate of tax is the same across the length and breadth of India, and hence some much-needed uniformity has seeped into the Indian market. Hence, the current GST rate stands at 12% for mobile phones, and they follow the HSN code 8517. As mobile phones sell out like hotcakes, the government is making a lot of money through the GST charged on the phone and economists believe that as the GST levels drop, phones will become even cheaper.

Inter and Intra State

As a consumer, while purchasing a new phone, we are eligible to pay 12% GST, and when the purchase is made from a dealer who resides and operates within the same state, the GST is split into SGST and CGST equally. Meanwhile, if bought from a foreign or migratory dealer, an IGST at 12% would be applicable, which is also the case in case you import phones from abroad.

HSN Codes

Most phones and mobile accessories come under HSN Chapter 85, and several slabs are available for the taxes. You must be aware of the right HSN code so that you can file your invoice appropriately. Here’s a look at a few HSN codes for commonly bought and used commodities.

ITEM HSN CODE GST RATE
Phones 8517 12%
Charger 8504 28%
Earphone 8518 18%
Battery 8506 28%
Power Bank 8504 28%
Leather Phone Case & Back Cover 4202 28%
Memory Card 8523 18%
USB Cable 8504 28%
Headphones 8518 18%
Plastic Screen Protector 3919 18%
Tempered Glass Screen Protector 3923 18%
Speakers 8518 18%

The GST rate is 12% irrespective of whether it is a smartphone or a feature phone. The GST rate on mobile accessories is 18% and varies slightly according to the specific product. Since mobile phones use wireless networks, they are part of Chapter 85 of the GST schedule. Here’s a look at the GST slab for the products.

  1. Phone – 12%
  2. Parts of phone – 12%
  3. Landlines – 18%
  4. Battery / Power Bank (Lithium-ion) –  18%
  5. Charger – 18%
  6. Earphone – 18%
  7. Memory Card – 18%
  8. USB Cable – 18%

Battery Issue

Indian phone manufacturers had asked the government to change the GST for the lithium-ion batteries and charge a 12% tax on them as they are used to manufacture the phone. Parts used for the telephone have levied a fee of 12% while these batteries were getting charged 28% and it is this discrepancy that led to the plea. However, they also reported that having the SGST, IGST and UGST affects the supply chain and that it adds interpretational challenges and makes more difficult the viability of low-scale production.

“The 12% GST on parts for mobile manufacture covers batteries, which are to be inserted into the mobile. There is no revenue implication on this measure, but it will greatly ease the pain which our manufacturers are subject to,” argues the Indian Cellular Association while talking to revenue secretary Hasmukh Adhia.

After the plea gained momentum, the government decided to slash GST rates of around 50 items including washing machines and mobile accessories, and electric companies have assured clients that they will ensure that the benefits will reach them as well in the form of lower prices. For example, Rajeev Bhutani, Senior Vice President, of Samsung India, clarified, “Samsung is a consumer-centric company. We are happy to extend full benefits, that is 7.81+ per cent of GST rate reduction to all our consumers. We believe it will fuel the demand for consumer electronics products now and in the ensuing festival season”. The decision also helped India’s mobile phone industry as it lowered the tax on the lithium-ion batteries.

What is the validity of GST certificate?

The GST certificate once issued is valid until it is cancelled, surrendered or suspended. But the GST certificate granted to taxable individuals has a validity date. Understand the procedure for GST registration and GST returns here.

What are Specified Enterprises as per the notification?

As per the provisions of the MSME Development Act, 2006, the Specified companies are those that have received goods and services from MSMEs and whose payments have not been made until 45 days. More on Income Tax Return Filing.

What are the different modes of filing the return of income?

You can file the income return either in paper form or even electronically. You may require a digital signature to validate the return forms when filing the returns electronically. Learn more about ISO Certification.

Can anyone join ISO?

Businesses or individuals can’t participate in ISO. However, the ISO membership is permitted for national standards companies and similar organizations representing standardization. More info on NGO Registration in India.

What are the different Acts in which NGO is registered?

The Societies, Trusts and the profitable NGOs are registered under the Indian Trust Act 1882, Societies Act 1860 and the Companies Act 1956 respectively. More about Udyog Aadhar Registration.

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What are the GST Rates for Mobile phones, Smartphones and Accessories?

13707

 

The Goods and Services Tax was an initiative undertaken by the Modi government to bring most commodities sold in India under one major tax bracket. This would result in lesser calculations and more ease in payment of the tax. There have been several revisions made since the idea first rolled out and the public has readily accepted most of these changes while some were severely criticized. The finance department coordinated with the banking institutions to set a reasonable slab and the current GST trends look to be staying as each revision updates and betters the previous template. Here’s a look at the GST rate for mobile phones and their accessories.

GST (Goods and Services Tax) is an initiative taken by the government to bring all commodities in the country under a single tax bracket. This new tax initiative will result in fewer calculations and easier payment of taxes. Electronic gadgets such as smartphones and accessories also come under GST and here we have curated the details related to the same.

Get Your Business a GSTIN Number

Present Scenario

The present-day world has already declared smartphones as their primary concern, and with annual sales skyrocketing year after year, it looks like the trend is here to stay. Several small and medium level enterprises sell mobile phones and mobile accessories, and the industry is a booming one that is expecting even more growth in the years to come.

Mobile phones and mobile accessories in India is under Goods and Services Tax. The GST rate on mobiles is currently 12% irrespective of whether the device is a smartphone or a feature phone. The GST rate on electronic mobile accessories is 18%.

Why GST

Before the GST, VAT was the primary form of tax that was levied on the mobile phone, and as the VAT rates varied from state to state, it was difficult to fix a standard price for the phone. Under GST, the rate of tax is the same across the length and breadth of India, and hence some much-needed uniformity has seeped into the Indian market. Hence, the current GST rate stands at 12% for mobile phones, and they follow the HSN code 8517. As mobile phones sell out like hotcakes, the government is making a lot of money through the GST charged on the phone and economists believe that as the GST levels drop, phones will become even cheaper.

Inter and Intra State

As a consumer, while purchasing a new phone, we are eligible to pay 12% GST, and when the purchase is made from a dealer who resides and operates within the same state, the GST is split into SGST and CGST equally. Meanwhile, if bought from a foreign or migratory dealer, an IGST at 12% would be applicable, which is also the case in case you import phones from abroad.

HSN Codes

Most phones and mobile accessories come under HSN Chapter 85, and several slabs are available for the taxes. You must be aware of the right HSN code so that you can file your invoice appropriately. Here’s a look at a few HSN codes for commonly bought and used commodities.

ITEM HSN CODE GST RATE
Phones 8517 12%
Charger 8504 28%
Earphone 8518 18%
Battery 8506 28%
Power Bank 8504 28%
Leather Phone Case & Back Cover 4202 28%
Memory Card 8523 18%
USB Cable 8504 28%
Headphones 8518 18%
Plastic Screen Protector 3919 18%
Tempered Glass Screen Protector 3923 18%
Speakers 8518 18%

The GST rate is 12% irrespective of whether it is a smartphone or a feature phone. The GST rate on mobile accessories is 18% and varies slightly according to the specific product. Since mobile phones use wireless networks, they are part of Chapter 85 of the GST schedule. Here’s a look at the GST slab for the products.

  1. Phone – 12%
  2. Parts of phone – 12%
  3. Landlines – 18%
  4. Battery / Power Bank (Lithium-ion) –  18%
  5. Charger – 18%
  6. Earphone – 18%
  7. Memory Card – 18%
  8. USB Cable – 18%

Battery Issue

Indian phone manufacturers had asked the government to change the GST for the lithium-ion batteries and charge a 12% tax on them as they are used to manufacture the phone. Parts used for the telephone have levied a fee of 12% while these batteries were getting charged 28% and it is this discrepancy that led to the plea. However, they also reported that having the SGST, IGST and UGST affects the supply chain and that it adds interpretational challenges and makes more difficult the viability of low-scale production.

“The 12% GST on parts for mobile manufacture covers batteries, which are to be inserted into the mobile. There is no revenue implication on this measure, but it will greatly ease the pain which our manufacturers are subject to,” argues the Indian Cellular Association while talking to revenue secretary Hasmukh Adhia.

After the plea gained momentum, the government decided to slash GST rates of around 50 items including washing machines and mobile accessories, and electric companies have assured clients that they will ensure that the benefits will reach them as well in the form of lower prices. For example, Rajeev Bhutani, Senior Vice President, of Samsung India, clarified, “Samsung is a consumer-centric company. We are happy to extend full benefits, that is 7.81+ per cent of GST rate reduction to all our consumers. We believe it will fuel the demand for consumer electronics products now and in the ensuing festival season”. The decision also helped India’s mobile phone industry as it lowered the tax on the lithium-ion batteries.

What is the validity of GST certificate?

The GST certificate once issued is valid until it is cancelled, surrendered or suspended. But the GST certificate granted to taxable individuals has a validity date. Understand the procedure for GST registration and GST returns here.

What are Specified Enterprises as per the notification?

As per the provisions of the MSME Development Act, 2006, the Specified companies are those that have received goods and services from MSMEs and whose payments have not been made until 45 days. More on Income Tax Return Filing.

What are the different modes of filing the return of income?

You can file the income return either in paper form or even electronically. You may require a digital signature to validate the return forms when filing the returns electronically. Learn more about ISO Certification.

Can anyone join ISO?

Businesses or individuals can’t participate in ISO. However, the ISO membership is permitted for national standards companies and similar organizations representing standardization. More info on NGO Registration in India.

What are the different Acts in which NGO is registered?

The Societies, Trusts and the profitable NGOs are registered under the Indian Trust Act 1882, Societies Act 1860 and the Companies Act 1956 respectively. More about Udyog Aadhar Registration.

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