In the recent communication held with DataWind, a mobile device manufacturing company stated that the tablet PCs are now going expensive due to the higher tax rates of 12 percent and 18 percent. Earlier there was lower 5 percent sales tax on the mobile devices and tablet PCs but the GST applicability made the gadgets out of reach from the lower income groups.
The Datawind CEO & President Suneet Singh Tuli also said that the 5 percent sales tax was sometimes get rebated under the Make in India initiative thus making totally altered scenario than and now. He stated that “In the last financial year, we have seen a steep rise in prices due to GST from nil to 18 percent. The GST rate for 7 -inch tablets is also at disparity with 6-inch smartphones, which have a 12 percent, while both sets of products carry the same functionality. This made educational tablets costlier and unaffordable among low-income groups.”
He is demanding that the GST on tablet PCs and smartphones must be lowered possibly to the 5 percent so that the industry can again take a flight towards the growth. He also mentioned that “We look forward to reduction in GST on low-cost educational tablets from 18 percent to 5 percent and if possible remove it completely. We are hopeful that the process of GST refunds gets expedited thus helping to run the business with ease.”
According to the reports, Datawind has secured the tablet market with 27 percent market share for the calendar year 2017 which is followed by iBall at second with 16 percent, Lenovo and Samsung at 14 percent each. The CEO mentioned that India imports most of the electronic goods from other countries which takes the cost of the products to a higher level. He suggested that the supplies must be shifted to the domestic alternatives and with lower tax rates.
He added that “There are a lot of low-end items being imported and if produced locally they present a good opportunity to indigenous companies by providing local employment. We hope this budget would be sympathetic towards the sector so as to resurrect the affected businesses again.” He also speculated that the upcoming budget might help in attracting economic development in all the sectors.
