No Duty Sops for Ap­ple on Im­ported Gear: Sithara­man

The Economic Times - - Companies: Pursuit Of Profit - Our Bu­reau

New Delhi: iPhone maker Ap­ple’s de­mand for cus­tom duty re­bate on im­ported equip­ment has been turned down. In a writ­ten re­ply to the Lok Sabha, com­merce and in­dus­try min­is­ter Nir­mala Sithara­man said “re­quests re­gard­ing such re­bate were ex­am­ined and… not ac­cepted”.

The de­mand was re­jected on grounds that al­ready, zero ba­sic cus­toms duty, ex­cise duty — ex­cept on charger, bat­tery and speaker — and spe­cial ad­di­tional duty (SAD) had been pre­scribed for com­po­nents and ac­ces­sories for fi­nal man­u­fac­ture of mo­bile phones, tablets and com­put­ers. Sithara­man said the gov­ern­ment has re­ceived rep­re­sen­ta­tions seek­ing con­ces­sions, in­clud­ing 30% lo­cal sourc­ing of com­po­nent, duty ex­emp­tion on man­u­fac­tur­ing and re­pair units, com­po­nents, cap­i­tal equip­ment and con­sum­ables for smart phone man­u­fac­tur­ing, ser­vice and re­pair.

“How­ever, with a view to pro­mote do­mes­tic man­u­fac­tur­ing ca­pac­i­ties and value ad­di­tion, it has fur­ther been pro­vided that this re­lax­ation will be valid for an ini­tial pe­riod of three years from the open­ing of the first store, and there­after, such en­ti­ties will be re­quired to meet do­mes­tic sourc­ing norms,” she told Par­lia­ment.

The com­merce min­is­ter also stated that there is no ex­emp­tion from ba­sic cus­tom duty, coun­ter­vail­ing duty and spe­cial ad­di­tional on im­ports of ar­ti­cles for re­pair of mo­bile. For­eign in­vest­ment up to 100% is per­mit­ted for man­u­fac­tur­ing mo­bile phones. Un­der the au­to­matic route, in­vest­ment can be made with­out prior ap­provals, ei­ther of the gov­ern­ment or the Re­serve Bank of In­dia.

Sithara­man also told the Lok Sabha that all ex­ist­ing ex­emp­tion from ex­cise to CVD will also be re­viewed by the GST Coun­cil. From July 1, both lo­cally man­u­fac­tured and im­ported mo­bile phones at­tract 12% GST. Ap­ple wants to make In­dia a ma­jor man­u­fac­tur­ing hub af­ter China and Brazil and has started man­u­fac­tur­ing through the Kar­nataka plant set up by Wistron to as­sem­ble iPhone SEs.

De­mand re­jected as zero duty is cur­rently ap­pli­ca­ble for a ma­jor­ity of com­po­nents for mak­ing mo­biles

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