GST Council has cut the tax rate on televisions upto 32 inches to 18 percent from 28 percent
Customers buying television sets (upto 32 inches) could see a decrease in prices January 1 onwards. The GST Council today reduced the goods and services tax (GST) for television screens upto 32 inches from 28 percent to 18 percent.
Avneet Singh Marwah, CEO, SPPL (exclusive brand licensee of Thomson TV in India) said they will be reducing prices from January 1 by 8 percent. He said the next wish would be to have GST reduced for TVs upto 40 inches.
"This is good news for the market and sentiments will improve from now on. Further, this will help improve the penetration of television (upto 32 inches) in the market," he added.
All television brands including LG, Samsung and Sony are expected to announce a price cut over the new few weeks.
Television makers had sought a reduction in GST for products upto 40 inches in this category. They had said televisions are no longer a luxury product.
In July 2018, televisions (upto 27 inches) that were earlier under 28 percent GST were brought down to 18 percent. The GST slab of 28 percent is the highest and is reserved for luxury products like high-end cars.
In the consumer durables space, air-conditioners are still taxed at 28 percent. This is because the GST Council is of the view that they are a luxury product.
A few dealers that Moneycontrol spoke to said this will boost New Year sales.
"All large television brands have offers for the first few weeks of the New Year. A tax cut will mean that customers will get additional benefit," said the Mumbai zonal head of a consumer electronics firm.
TV makers were reeling under cost pressures due to 28 percent GST on one side and a rise in manufacturing costs on the other, due to rupee depreciation and fuel price increase. Panel costs were also hiked during the festive season.
A majority of the raw materials, including the panels for televisions, are imported from abroad.