Budget 2017: Is likely to affect hike in mobile phone price in India.

Hike in the cost of mobile phones is likely to take place in India, after the announcement of Budget 2017-2018.

The cost of the mobile phones is likely to go up next fiscal Budget 2017-2018 because of the Special Additional Duty (SAD). This additional duty will bring cahnge of additional two percent hike in PCBs or Printed Circuit Board used in the manufacture of mobile phones. Initially there was no such SAD charges levied but now two percent duy will be imposed on all imported PCBs.
Since 40-50 percent of the phone value is determined by the PCBs, therefore an increase in the duty of these components will result of increse price of mobile phones. “We are expecting a one per cent value impact on the price of the mobile, but obviously this is not going to happen overnight. While one per cent might not seem much, if you take into consideration the number of mobile phones being manufactured and sold in India, this duty will translate into a bigger cost for the company,” said Bipin Sapra, Partner – Indirect Tax at EY.