Budget 2024: FM cuts basic customs duty on mobile phones, chargers to 15%

The union finance minister announced a reduction in basic customs duty (BCD) on mobile phones, their printed circuit board (PCB) assembly, and chargers to 15 per cent from the previous rate of 20 per cent.

Making the announcement in the Budget 2024-25, the finance minister said, “With a three-fold increase in domestic production and almost a 100-fold jump in exports of mobile phones over the last six years, the Indian mobile phone industry has matured. In the interest of consumers, I now propose to reduce the BCD on mobile phones, mobile PCBA, and mobile chargers to 15 per cent.”

“To increase value addition in the domestic electronics industry, I propose to remove the BCD, subject to conditions, on oxygen-free copper for the manufacture of resistors. I also propose to exempt certain parts for the manufacture of connectors,” the finance minister added.

Reduction in BCD on these items was a major demand from the electronics manufacturing bodies.

Industry body India Cellular Electronics Association (ICEA) has been advocating for reducing the duties along with tariff rationalisation and said that it was necessary to improve India's competitiveness on the global level in electronics manufacturing and attracting global value chains.

Congratulating the government on the announcement, Pankaj Mohindroo, chairman of ICEA, said, “We are impressed with the government's intent and direction focusing on enhancing manufacturing and export competitiveness. The finance minister has also acknowledged the tremendous growth of mobile phone manufacturing and exports. We had recommended reducing BCD on mobile phones, their PCBA, and chargers/adapters to 15 per cent, which has been accepted. The mobile and electronics industry is elated with the announcements and will go a long way to enhance manufacturing, exports, and our competitiveness.”

“Our proposal for tariff slab rationalisation has also been acknowledged, and the finance minister has announced that it will be taken up in the next six months, which will further embolden the industry and its competitiveness,” he added.

During her budget speech, the finance minister said that the government will undertake a comprehensive review of the rate structure over the next six months to rationalise and simplify duties for ease of trade, removal of duty inversion, and reduction of disputes.