CEITA urges Centre to reduce GST on electronics to protect domestic trade

The Chennai Electronics and Infotech Traders Association (CEITA) has urged the Union Finance Ministry to reduce the Goods and Services Tax (GST) on all electronic goods from the current 18% to 5%, citing survival challenges for domestic manufacturers and traders.

Traders under CEITA have a massive presence inside Ritchie Street, the second largest electronics market in India after Nehru Place in New Delhi. This particular electronics market has over 2,000 retailers and wholesalers providing employment to over 4,000 people directly and another 1,000 indirectly (logistics, food and other services around this area).

The CEITA has called upon the Finance Minister to reduce GST to 5% on all electronic goods — including CCTV systems, power supplies, adapters, stabilizers, remotes, cables, computers, computer accessories, mobiles, and mobile spares.

“Thin margins and heavy tax burdens are pushing small and medium businesses to the brink. Without rationalising GST, domestic trade cannot compete with imports,” said R. Chandalia, Honorary Secretary of CEITA.

“High taxation has made locally-manufactured products unviable, forcing the trade to rely heavily on cheaper imports from China and Taiwan. China levies up to 13% GST on electronics. Countries like Singapore, Korea, and Japan offer reduced tax rates on essential goods, enabling their domestic industries to thrive,” he pointed out.

“This urgent intervention is essential to revive domestic trade, attract investments, create employment, and strengthen India’s global competitiveness in electronics industry. A rationalised GST will not only safeguard SMEs but also accelerate the vision of Make in India and Digital India,” he highlighted.

According to details shared by Mr. Chandalia, Chinese and Taiwanese goods are capturing the Indian market due to cost advantages. While India’s electronics exports have grown from $11.28 billion in 2019–20 to $15.6 billion in 2023–24, this still represents less than 1% of the $4.3 trillion global market. In contrast, China accounts for nearly 60% of global electronics production.