GST, India’s expanding digital landscape is built on electronic devices. Of course, one step in simplifying their taxation is to include them within the GST. VAT, service tax, and excise duty have all been replaced by GST, which can range from 5% to 28% on electronics. Compared to the combined taxation scheme, the GST rate on electronics is somewhat higher. As a result, buyers now pay a little more for technological goods. The introduction of GST on electronic goods simplifies electronics taxation and lowers compliance expenses for entrepreneurs who deal with electronic goods.
What is GST on Electronics and Electrical Items?
Depending on how the electronic items are classified, the GST rate varies. In general terms, there are five tax slabs for GST on electronic goods: 0%, 5%, 12%, 18%, and 28%. For instance, because they are considered luxury items, refrigerators and cell phones are subject to 18% GST, while air conditioners and televisions larger than 32 inches are subject to 28% GST. Businesses and consumers can better manage the financial effects of buying and selling gadgets by being aware of these rates.
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Classification of GST on Electronics & Electrical Items
GST on electrical and electronic goods is categorised according to a number of criteria, such as size, capacity, and utilisation. For example:
- Utilisation
Different GST rates may apply to goods in manufacturing or particular industries. Furthermore, additional GST charges are applied to electronic goods that are categorised as luxury goods.
- Sizes and Abilities
Higher GST rates may apply to larger or more modern goods, such as industrial machinery or high-capacity appliances.
This classification makes sure that the tax code takes into account the wide variety of electrical and electronic products that are on the market.
Electrical and Electronics Items Taxed at 0% GST
At the moment, there are no particular electrical or electronic products that qualify for a 0% GST rate. Due to their influence on consumers and businesses, the majority of electronic devices are subject to higher GST rates.
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Electronics & Electrical Items Taxed at 5% GST
The following goods are subject to 5% GST on electronics:
| Item | HSN Code | GST Percentage |
| Electric Vehicles | 87 | 5% |
| Chargers for Electric Vehicles | 8504 | 5% |
To encourage an eco-friendly choice, a lower GST bracket has been allocated for electric vehicles.
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Items related to electronics and electricity are subject to 12% GST.
The following goods are subject to 12% GST:
| Item | HSN Code | GST Percentage |
| Solar water heater and system | 841912 | 12% |
| Bio-gas plant | 848594 | 12% |
| Solar-powered devices | 848594 | 12% |
| Solar power generators | 848594 | 12% |
| Windmills, Wind Operated Electricity Generator (WOEG) | 848594 | 12% |
| Waste to energy plants/devices | 848594 | 12% |
| Solar lantern/solar lamp | 848594 | 12% |
| Ocean waves/tidal waves, energy devices/plants | 848594 | 12% |
| Photo voltaic cells | 848594 | 12% |
| Instruments used in surgical, medical, dental, or veterinary sciences | 9018 | 12% |
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Items related to electronics and electricity are subject to 18% GST.
The following goods are subject to 18% GST:
| Item | HSN Code | GST Percentage |
| Refrigerators | 8418 | 18% |
| Television sets up to 32 inches | 8528 | 18% |
| Mobile phones | 8517 | 18% |
| Printers | 8443 | 18% |
| Refrigerators | 8418 | 18% |
| Electrical Capacitors | 8532 | 18% |
| Electrical Resistors | 8533 | 18% |
| Vacuum cleaners | 8508 | 18% |
| Electric smoothing irons/Electric water heaters/ Hair dryers | 8516 | 18% |
| Electrical lamps | 8539 | 18% |
| Microphones and loudspeakers, headphones and earphones | 8518 | 18% |
| Camera | 9006-9007 | 18% |
| Electrical transformers, static converters | 8504 | 18% |
| Closed-circuit television (CCTV) | 8525 or 8806 | 18% |
| Electrical insulators | 8546 | 18% |
| Household or laundry, washing machines | 8450 | 18% |
| Water purifier | 8421 | 18% |
| Laptops and computers | 8471 | 18% |
| Electric Detonators | 3603 | 18% |
| Electric padlocks and locks | 8301 | 18% |
| Machinery, plant, or laboratory equipment for heating | 8419 other than
8419 12 |
18% |
| Electric office machines such as coin-sorting machines, automatic banknote dispensers, etc. | 8472 | 18% |
| Electric motors and generators | 8501 | 18% |
| Electric generating sets and rotary converters | 8502 | 18% |
| Electro-magnets | 8505 | 18% |
| Lighting or signaling equipment such as windscreen wipers, demisters, etc. | 8512 | 18% |
| Machines for welding, soldering, etc. | 8515 | 18% |
| Industrial furnaces and ovens | 8514 | 18% |
| Electric traffic control equipment | 8530 | 18% |
| Sound-signaling or visual-signaling apparatus such as bells, sirens, etc. | 8531 | 18% |
| Electrical circuit parts such as switches, relays, etc. | 8535 or 8536 | 18% |
| Apparatus for distribution of electricity such as boards, panels, etc. | 8537 | 18% |
| Electric conductors | 8544 | 18% |
| Electric musical instruments | 9207 | 18% |
| Lighters | 9613 | 18% |
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Electrical and Electronics Items Taxed at 28% GST
The following goods are subject to 28% GST:
| Item | HSN Code | GST Percentage |
| Air-conditioners | 8415 | 28% |
| Electric accumulators, including separators | 8507 | 28% |
| Monitors and projectors | 8528 | 28% |
| Electrical ignition | 8511 | 28% |
| Dish-washing machines | 8422 | 28% |
| Television sets larger than 32 inches | 8528 | 28% |
Impact of GST on the Electronics Sector
The overall electronics industry has been impacted by the GST adoption in a number of ways. It has simplified the taxation process and reduced business compliance expenses. In the Indian market, however, electronic products are still considered luxury goods.
Because of this, business owners selling electronics have found it challenging to compete with low-cost imported electrical equipment because the GST on electrical items has been at the higher end of the tax levels. The majority of household gadgets now cost more, and their demand has decreased as a result of the higher GST rates on electronics.
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How GST Rates on Electronics Impact Business Owners
Depending on factors including size, capability, and use, different electronic items have varying GST rates. In order to set reasonable prices and maintain their competitiveness in a market that is always changing, business owners must carefully consider these GST rates on electronic devices. Legal operation and the ability to collect input tax credits, which can reduce tax obligations, depend on proper GST registration.
Timely filing, accurate record-keeping, and applying the appropriate rates after incorporating the GST rates are all necessary to maintain compliance with the requirements. Inadequate documentation may make it more difficult to obtain input tax credits, which could result in increased expenses and perhaps legal problems. Incorporating GST into pricing strategies must be balanced to maintain profitability and regulatory compliance without reducing competitiveness.
How GST Rates on Electronics Affect Consumers
In terms of consumers, the GST has had a major effect on gadgets. The demand for commonplace electronic devices like television sets and cell phones has declined as a result of the higher GST rates on electrical goods. Sales of air conditioners have decreased as a result of consumers being deterred from buying them by the high GST rate of 28%.
Read also: GST on Hotels & Food: Rates, Impact & Analysis
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