Budget 2022: Electronics Industry On The Fence About Duty Rationalisations Announced


The Finance Minister Nirmala Sitharaman at the announced duty concessions for parts of mobile phones

The Union Budget 2022-23 has left the electronics industry on the fence with the concessions and duty rebates announced. Consumer electronics manufacturers were left disappointed as there was no rationalisation on smart TVs and other products.

Consumer electronics makers, instead, had urged the government to reduce the GST rate on colour televisions, which, they claimed, at 28 per cent for televisions above 32 inches (and 18 per cent otherwise), was inexplicably high.

“From an electronics sector standpoint, we expected reforms in the Union Budget FY 2022-23 that would accelerate growth channelised by consumer demand,” said Manish Sharma, CEO, Panasonic India.

“For instance, rationalising GST from 28 per cent to 18 per cent on ACs and large-screen size TVs will improve affordability and penetration as these are no longer considered luxury items. We will look forward to hearing from the GST committee on this,” Sharma said in a statement.

The India Cellular & Electronics Association (ICEA) had also recommended a reduction in the GST rate on colour televisions.

Mobile Parts Duty Concession

On the other hand, the Finance Minister Nirmala Sitharaman at the announced duty concessions for parts of mobile phones. It is to be noted that the ICEA had been urging the government to provide such concessions since the past year.

“Customs duty rates are being calibrated to provide a graded rate structure, to facilitate domestic manufacturing of wearable devices, hearable devices and electronic smart meters,” she said.

Sitharaman added that duty concessions are being given to specific components including “transformer of mobile phone chargers, and camera lens of mobile camera module and certain other such items.”

The Union Budget 2021 had introduced a 2.5 per cent customs duty on smartphone components including PCBA, camera module, and connectors.

However, the industry has demanded more clarity on the issue.

“Concession on duty for local manufacturers is a fantastic move much awaited by the domestic electronic manufacturers all across the country,” said Aashish Kumbhat, Founder and Director, Inbase which provides smart mobile accessories. “This will give our domestic manufacturers power to compete directly with finished goods imported from China and other neighbouring countries.”


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