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GST Council keeps GST on mobile phones at 18%, so smartphone prices hold; no decision on MDR
Our read
Smartphone prices hold because GST stays at 18%, so keep mobile pricing and margin plans unchanged, and small e-commerce sellers should prepare for simpler registration and an optional scheme for small consumer-facing businesses with a Rs 5 crore turnover limit.
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A formal notification of the simplified registration for small e-commerce sellers
Ask next
Which other rule changes affect Indian retailers this month?The report,
The GST Council's 57th meeting kept GST on mobile phones at 18 per cent, so smartphone prices stay unchanged. It took no decision on Merchant Discount Rate. It also proposed simpler registration for small e-commerce sellers and an optional scheme for small consumer-facing businesses.
- GST on mobile phones
- 18 per cent
Newer report adds to this story , : Sitharaman said the meeting did not discuss MDR at all.
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Reported figures
From the report. Source details below
| Prosecution threshold raised to: | Rs 5 crore |
|---|---|
| Prosecution threshold earlier: | Rs 1 crore |
| Maximum general penalty proposed: | Rs 10,000 |
| Maximum general penalty earlier: | Rs 25,000 |
| Optional scheme turnover limit for small consumer-facing businesses: | Rs 5 crore |
What to watch next
- The final turnover limit in the optional scheme, if it stays at Rs 5 crore
- MDR appearing on the agenda of the next GST Council meeting
- Any change to smartphone list prices or discounts from major brands
- Public objections from states to the optional scheme
Likely next moves
Our read of what comes next — analysis, not reported by the source.
- Smartphone brands and large retailers are likely to leave list prices and festive-season offers as they are, since the 18% GST rate gives no reason to reprice.
- Large e-commerce marketplaces are likely to welcome the simplified registration and may step up onboarding of small sellers once it is notified.
- The GST Council may return to Merchant Discount Rate at a later meeting, but is unlikely to settle it soon given that it took no decision at the 57th meeting.
- States may press for safeguards on the optional scheme for small consumer-facing businesses, including a close look at the Rs 5 crore turnover limit.
- Payment companies, banks and merchant bodies are likely to keep lobbying on MDR, since the lack of a decision leaves the issue open.
The source
First seen