No Custom Duties on Consumer Electronics, Mobiles of Up To Rs. 50,000

No Custom Duties on Consumer Electronics, Mobiles of Up To Rs. 50,000

No Custom Duties on Consumer Electronics, Mobiles of Up To Rs. 50,000

Gone are those days when using an imported good makes you penny less because you have to let go of all your money after them. Imported goods especially electronics and gadgets such as laptops and mobile phones are very common things that people use these days. Microsoft, Samsung, Apple, HTC and lot more are the leading companies which provide us mobile phones, laptops and other gadgets. To buy all these brands one has to pay a lump sum custom duty which brings up the price of the model in domestic market. But from now onwards the scenario will be different as the Commerce and Industry Ministry has revised the rate of custom duty for the imported goods.

No Custom Duties on Consumer Electronics, Mobiles of Up To Rs. 50,000

Custom duty on imported goods for personal use

  • In earlier times the 18% custom duty used to be paid over the cost, insurance and freight of the mobile phone, 14.712% for the laptops and PCs and finally 28.852% for the TV sets. Also the consumers had to pay flat fee of 41.492% which is not required to pay anymore, declared in latest notification.
  • On August 12th this year the ministry has declared that from now onwards there will be huge relaxation on the imported electronic goods especially gadgets. According to the last rule, under the clause no. 3(1)(i)(h) of the Foreign Trade, custom duty will be levied on imported goods that cost above Rs. 2000/-. However as per the latest and revised provision the limit of maximum amount is Rs. 50, 000/- which is much more than the previous limit. This is definitely good news for the Indian buyers who love to carry imported gadgets or electronic products.
  • In case of imported goods for personal or commercial goods the rate of custom duty was 41.492% on the products that cost above Rs. 2000/- now the maximum amount will be Rs. 50,000/-.

Custom Duty on imported goods for commercial use

  • Unfortunately the provision has been revised for the goods for personal use only. As per the ministry the provision will not be working if any single product will be imported in bulk numbers that is for commercial purposes.
  • Sellers who trade imported products in domestic markets will have to follow previous rules of imposing duty on products worth of Rs. 2000/- and above. They will not get any benefit on the trading ground.
  • The same rate of 41.492% of custom duty will be levied on the products for commercial use as well. But as mentioned the maximum amount will also be same as before that is Rs. 2000/-.

Overall affects on consumers

It is obvious that the effect on consumers will be positive. Indian mass consumers use imported goods, some buy from domestic markets, some import directly from the international market. In either case the consumer had to pay a lump sum tax before. Now as per the new provision relaxation has given to the upper limit so consumers can enjoy their phones, TV sets and laptop from international brands at much cheaper rates. But they can enjoy the lower rate only if they directly import the products from the brand itself rather than buying it from any domestic market.

How does it affect the domestic sellers?

Unfortunately this may bring down the business of domestic market for international products. Like I mentioned the provision or rule will not be applicable for the bulk orders, so sellers, especially online shopping domains will not be able to offer the products in cheaper rates.

As for example a DSLR from Canon costs $399 that is Rs. 27,300/- in international market whereas in domestic market it costs Rs. 32,000/-. Same with HTC phones that costs Rs. 40, 000/- (average) in international markets while it costs Rs. 48, 000/- (average) in domestic markets. So it can be seen that domestic market for international products, especially the online shopping stops might face a loss as from now onwards importing directly will be much cheaper.

Traders who sell such products in less volume like 2-3 items can enjoy the provision but those who sell these products on regular basis in high volume like 40-50 items will not be able to enjoy the tax benefit after this.

Custom Duties on Several Products:

ProductsCustom Duty
TV sets28.852%
Mobile Phones18%
Laptops and PCs14.712%
Maximum LimitRs. 2000 (before)

Rs. 50,000 (after)

Commercial useNA

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