Experts stated that transition from old tax regime into new Goods and Service Tax (GST) Regime has adversely influenced the smartphone shipments specifically in the month of June. According to Canalys Singapore, based research firm findings stated that after the roll- out of new indirect tax regime the sales of the smartphone in domestic market shrunk for the first time on the year and fallen by 4% nearly 27 million units in the duration of April- June.
In the views of Counterpoint Research stated that the sale figures of smartphones were fallen by 9% as compared to the previous year. However, Counterpoint Research had estimated that 4% rise in the duration of April-June shipments at 30 million units. Retailers and distributors were fearing about the impact of Goods and Services Tax (Regime) on prices which had negatively influenced the smartphone market and they adopted a wait- and see policy.
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Canalys expert Rushabh Doshi stated that “Retailers and distributors were wary of changes, and adopted a wait-and-watch policy before resuming operations to 100%. Time was spent adapting processes to be GST-compliant, as opposed to selling more devices.” By adding that, “there is general confusion in the entire market over GST and lack of awareness on changes needed.”
Associate Director at Counterpoint Research, Tarun Pathak stated, “Sell-in was heavily impacted in anticipation of the GST rollout during the later part of Q2 2017. Retailers were quite hesitant in adding new stock into the channels during June even though there was some assurance from the OEMs (original equipment manufacturers) regarding inventory clearance.”
