Mobile chargers & USB cables set to become costlier under new rules

Moneycontrol News 

The government on Monday imposed a 10 percent import duty for static converters for cellular phones, such as the USB cable. A basic customs duty of 10 percent was also imposed on imported chargers and adapters the latter as per an Economic Times report.

Also Read: Government slaps 10 percent import duty on USB cables for mobile charging

The industry welcomed the new 10 percent duty imposed on chargers saying that it would help the local manufacturing units and take care of a rule that allowed for the import of charger adapters without paying any duty.

Indian Cellular Association National President Pankaj Mohindroo said that this is a reflection of the government’s commitment towards phased manufacturing programme, designed to boost domestic ecosystem for mobile phone products in India.

The decision comes even as the post-GST regime has made smartphones four to five percent costlier as they've been put under the new 12 percent tax slab.

The move is apparently part of the government’s roadmap to offer tax benefits to those making mobile phones and mobile phone components and is targeted to increase local value addition to 35-40 percent from the current six percent.

GST has made the locally manufactured mobile phones more expensive as they previously operated under lower tax rates due to benefits provided under government’s “Make in India” policy.

Under the government’s Make in India push, around 80 percent of the 59 million phones sold in India in the January-March quarter this year were made locally, up from 65 percent in 2016 when 265 million phones were made, as per Counterpoint Research data.

Many popular Chinese players in the smartphone market here including Lenovo and OnePlus also source a substantial part of their India requirements through import.