Will GST Make Desktops and Laptops Costlier?

The prices of desktops and laptops will become more expensive with GST rolls out. It raises concern in the industry which has been promising for lower tax rate on electronics to promote Digital India move.

Recently, the GST Council has fixed 18% of tax on the prices of desktops and laptops, over the current 14% to 15% of tax. Other hardware products like printers and monitors will be taxable at staggering 28%.

Around 12% of tax has been recommended on PCs by the Manufacturers Association for Information Technology, which would have helped in booming IT scope by making desktops cheaper, according to Anwar Shirpurwala, executive director of an industry body. IT products are the heart and soul of Digital India. On the other side, price hike on such products will be an opposite impact.

The main hardware products like laptops and desktops, and their peripherals like printers and monitors are the pillars of success of IT sector.

When 18% tax is charged on PC, 28% will be charged on monitor. Shirpurwala further said, “It is a bit confusing as why they have split the same type of products into two categories and why they don’t have any match.” It will cause a huge impact on the cost of consumer products.

The inverted duty program which made it least expensive on import has raised concern for the industry as manufacture may return domestically after GST regime.

Rajeev Jain, Group Chief Financial Officer and Director at Intex Technologies (IT accessories and Smartphone maker), added that the rates were on proposed lines excepting IT products, which look on higher side.

He added, “Clarity is a must on GST on area-based exemptions and services. Transparency is also important on various duties on local manufacturing and imports to look at the overall impact of GST.”

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