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GST to reflect as uptick in mobile phone rates
Posted on: 20/May/2017 5:23:21 PM
Mobile phone users or those intending to buy new handsets, you need not look forward to anything from the Goods and Services Taxes. The GST council has arrived at 18 percent tax towards telecom service which will be increase in 3 percentage points. At present, the tax on telecom services is 15 percent.
This decision is made in addition to the 12 percent service tax imposed on mobile handsets. The telecom industry segments are already irked with this raise in tax, and all the major players are bothered by the same. Consumption and investment are resultantly prone to decline.
If the monthly usage gets increased to Rs 1,000, the mobile user will have to pay extra Rs 30 due to this increase in telecom services from 15 to 18 percent, claim reports.
Resultantly, the talk time offered by different telecom providers may also get hit. For example, if Rs 85 is the talk time offered under Rs 100 recharge, it will get reduced to Rs 82 now. The reason is the introduction of GST on telecom services that will bring down talk time by Rs 3.
According to reports, handset rates of major brands are prone to get increased by 4 to 5 percent because of 12 percent tax rate. As of now, the smartphone makers enjoy a lot of discounts on taxes because of local produces of mobile phones.
Between January and March this year, 59 million mobile handsets got sold. Out of this, 80 percent of them were produced locally to note.
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