The Indian handset manufacturers have sought clarifications regarding the taxes applicable on smartphone batteries and asked for the rationalisation of the taxes. The industry seeks answers regarding the goods and services tax on lithium-ion batteries used in both feature phones and smartphones.
The demand, however, is stuck at 12% which must be on par with the other parts of mobile phones used in making it completely out of the factory. The Indian Cellular Association mentioned in the statement that, “it may be clarified that 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 being subject to.”
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The association had cleared that the overall tendency looms on the revenue administration who in course deny the 12 per cent GST on batteries for the manufacturing of mobile phones and 18 per cent GST on the replacement market sale, ultimately levying 28 percent goods and services tax.
The latter also evoked some of the issues saying that there are 3 types of results in GST which makes it a challenge as it turmoils the manufacturing supply chain importantly in the input tax credit system and lessens the chance of low margin manufacturing.
At last, the industry demanded a lower 18 percent goods and services tax on lithium-ion batteries reduced from 28 percent higher tax applicability to be inline with other battery types.
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