‘It's an essential good now’: Association wants mobile phones in 5% GST slab

India Cellular & Electronics Association wants mobile phones and related components be placed in the 5% GST slab reserved for essential goods.

India’s mobile phone sector has emerged as one of the greatest achievements of Make in India(Pibxabay/Representative image)

The current 18% GST is regressive for the mobile phone, and the primary tool of digital access for over 90 crore Indians must be treated as necessity in the forthcoming GST reforms, is the argument.

“The mobile phone is no longer aspirational. It is essential digital goods. It should rightly be taxed at 5% GST, in line with PM Modi's GST reforms agenda and his vision of a $500 billion electronics ecosystem,” ICEA Chairman Pankaj Mohindroo said.

India’s mobile phone sector has emerged as one of the greatest achievements of Make in India. Production has grown from Rs. 18,900 crore in FY15 to Rs. 5,45,000 crore in FY25, while exports have crossed Rs. 2,00,000 crore, making India the second-largest mobile phone manufacturer globally.

At the same time, the domestic market has weakened. Since the GST hike to 18% in 2020, annual consumption has fallen from nearly 300 million units to about 220 million units.

This has hurt affordability, slowed replacement cycles, and disproportionately impacted volume growth.

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