GST Council is considering reducing the current 18% GST on mobile phones. This discussion comes at a time when smartphone demand in India has slowed. Shipments fell by nearly 10 to 11% between April and June, marking the sharpest June quarter decline in six years. Policymakers are concerned that high taxes could affect India’s mobile phone manufacturing industry.
India produced mobile phones worth about ₹6.27 lakh crore in FY26. To strengthen this sector further, the government recently approved a ₹62,500 crore scheme aimed at boosting domestic production. The proposed GST cut is expected to make smartphones more affordable for consumers if companies pass on the benefit.
The government’s earlier production-linked incentive scheme delivered strong results, and the new measures are designed to build on that success. Lowering tax burdens could help balance revenue needs with industry growth, encourage local sourcing, and position India as a global hub for mobile manufacturing.
The decision is not yet final. However, if the GST reduction is approved, buyers may see their next smartphone priced a little lower, offering relief to consumers while supporting India’s ambitious electronics sector expansion.
