GST regime: Handset makers want credit to be linked to value addition

Only 2% value addition takes place in printed circuit board assembly

A proposed 10-15 per cent import duty on mobile handsets, intended to promote local manufacturing, may erode incentives for local manufacturers.

The goods and services tax rate for mobile handsets has been set at 12 per cent and the government is planning to impose a basic customs duty on handsets to discourage imports.

The tax rate on imported handsets and locally manufactured ones will be almost at par, neutralising incentives for local manufacturing.

Industry body MAIT, with members like Samsung, Apple, LG, Lenovo and Asus, has made a representation to Revenue Secretary Hasmukh Adhia about this. In a letter on