Early indications of the 2008 Budget exercise suggest that the prices of electronics goods like LCD TVs, home-theatre systems and high-end mobile phones may fall by 8 per cent to 10%.
The duties on consumer electronics may descend to 12% as compared to 16% now. At the same time, the finance ministry has indicated that it was not in favour of reducing excise on raw materials like plastic and intermediaries like components.
The move to reduce excise on electronics goods is to bring them at par with computers and laptops, which are taxed at 12%. This stir would cut back on the excise structure and bring excise on all similar products at the same level. The duty cut is in line with the government’s plans to encourage hardware manufacturing.
While the country’s hardware needs today are met mostly through imports, the government is planning to change this trend by encouraging investment in IT hardware manufacturing.