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GST is a major factor that influences the prevailing prices of many commodities, from packaged food items to motor vehicles, with uniform tax brackets. A GST tax at the rate of 18% is also applicable on mobile phones. The 56th GST Council meeting in September 2025 confirmed that this tax rate will remain unchanged. Having clarity about the GST rate on mobile phones can help you get to the correct estimate of the price that you have to pay on its purchase.
Below is a quick reference table that lists the HSN code for mobile phones and a clear breakup of the GST rate applicable to them:
| Product/Commodity | HSN Code | CGST Rate | SGST Rate | IGST Rate |
|---|---|---|---|---|
Mobile phones |
8517 |
6% |
6% |
12% |
Here’s a handy table outlining the HSN codes for different mobile accessories, along with the corresponding GST rates for each:
| Product/Commodity | HSN Code | CGST Rate | SGST Rate | IGST Rate |
|---|---|---|---|---|
Power bank |
8507 8000
|
9% |
9% |
18% |
Tempered glass screen protector |
7007 |
9% |
9% |
18% |
Tempered plastic screen protector |
3919 |
9% |
9% |
18% |
Memory card |
8523 |
9% |
9% |
18% |
Lithium-ion batteries |
8507 6000 |
9% |
9% |
18% |
Headphones, Earphones, Speakers |
8518 |
9% |
9% |
18% |
Chargers and Adapters |
8504 |
9% |
9% |
18% |
Leather Phone Back Covers |
4202 |
9% |
9% |
18% |
The HSN Code (Harmonised System of Nomenclature) is a standardised product classification system used in India (and globally) under GST to uniquely identify goods. HSN are 8-digit codes used by the GST Council to categorise commodities under the GST regime. GST on mobiles and related accessories are calculated under HSN Chapter 85.
Using the correct HSN code is important for accurate invoicing, tax compliance, and to avoid wrong taxation or penalties. For example, the HSN code 8517 (for mobile phones or telecommunication devices) ensures the correct GST rate (18%) is applied.
During the 56áµ—Ê° GST Council meeting, the government introduced a simplification of GST slabs, reducing the previous structure of four slabs (5%, 12%, 18%, 28%) into primarily two standard rates: 5% and 18%, effective 22nd September 2025.
There were various rate changes for many goods and services – for example, TVs, air-conditioners, and other electronic appliances being moved from 28% to 18%. However, the GST rate on mobile phones remains unchanged at 18%.
The Goods and Services Tax (GST) replaced VAT and excise duty in 2017, creating a uniform tax structure across India. While mobile phones were initially taxed at 12% under GST, the rate was increased to 18% in the 39th GST Council meeting (2020). This higher rate directly impacts phone prices, but the shift to a single tax system has brought greater consistency and reduced state-wise price differences.
Let’s look at an example to better understand these changes. Consider a phone with a base production cost of ₹10,000. Here is a table comparing the prices of mobile phones as per the pre-GST and post-GST regimes:
| Particulars | Pre-GST Price | Post-GST Price |
|---|---|---|
Production Cost |
₹10,000 |
₹10,000 |
Excise duty at 1% |
₹100 |
NA |
Base Value |
₹10,100 |
₹10,100 |
14% VAT/18% GST |
₹1,414 |
₹1,800 |
Sale Price Quoted by the Producer to the Retailer |
₹11,514 |
₹11,800 |
Packing Charges |
₹500 |
₹500 |
Total Value |
₹10,600 |
₹10,500 |
Total price |
₹10,670 |
₹10,590 |
When you buy a mobile phone from a retailer from the same state, Central and State GST (CGST and SGST) are applicable at 9% each. On the other hand, if you purchase it from a retailer outside your state, an Integrated GST (IGST) of 18% is applicable.
SGST and CGST rates are applicable on intra-state purchases of a commodity. So, if you purchase a mobile phone from a retailer in your state, you will pay these two components of GST. However, an inter-state purchase of mobile would attract IGST.
The GST Rules underline two types of supplies based on their nature: composite and mixed. The concept of composite supply is associated with GST on mobile phones.
Composite supply means the supply made by a taxable person to the recipient of a commodity having two or more taxable goods. These goods are generally provided in conjunction or bundled together.
When you purchase a mobile phone, it comes with other devices like a charger and USB cord. Under composite supply, the GST on mobile and other components will be the same.
You can claim Input Tax Credit (ITC) on mobile phones. However, you need to fulfil certain requirements in order to claim it:
The mobile must only be purchased and used for business purposes
The tax invoice must have the seller’s address, GSTIN, and name along with the name of the buyer’s company, address, GSTIN, and HSN code
The recipient must have received the mobile device
The provided must have submitted the GST reports and paid their GST due to the government
In the Union Budget 2024 the government cut the Basic Customs Duty (BCD) on imported mobile phones, chargers and PCBAs from 20% to 15%. Earlier, in the Budget 2023, the duties on camera lenses and several manufacturing parts were set to nil. These also include the camera module for mobile phones (all these previously attracted a 2.5% BCD).
An earlier exemption for lithium-ion cells used in phone batteries was also extended until 31st March 2024. Before that, the Union Budget 2020 reinstated the social welfare surcharge on imported handsets (previously exempt), adding to the existing customs burden and making imports relatively more expensive than local units.
Importers also pay IGST on the post-duty value: IGST is calculated on the assessable value plus BCD and any other applicable duties. Because IGST is levied after customs duties are added, the combined effect of BCD, surcharge and IGST raises the landed cost of imported mobile phones in India.
Dealers often use exchange and discount promotions for mobile phones, and GST affects how these offers are taxed.
An exchange offer lets you trade an old handset for credit toward a new one; you pay the difference between the new phone’s price and the trade-in value. Under GST, tax is applied to the full sale price of the new device, not the net amount paid after trade-in.
For example, if a ₹30,000 phone is sold to you for ₹25,000 after exchange, GST is levied on ₹30,000. This raises the effective tax burden compared with the pre-GST treatment, when only the balance was taxable.
Invoice-documented promotional discounts reduce the taxable value when the reduction is clearly shown on the invoice, so GST is calculated after subtracting such discounts.
If a supplier previously claimed Input Tax Credit (ITC) and later issues a credit note for a discount, the supplier must reverse the corresponding ITC. Accurate invoicing and proper credit-note handling are therefore essential to ensure correct GST treatment.
GST established uniform pricing for mobile phones across India. Under the old VAT system, states applied different rates — for example, Gujarat charged 14%, which led buyers to purchase from cheaper dealers in other states. While GST has sometimes pushed nominal prices up, it removed state-to-state rate disparities and reduced tax cascading. As a result, consumers nationwide now pay the same price for the same phone.
The following are some of the benefits that dealers have been able to enjoy after the introduction of GST for mobile phones:
Increase in Sales: A mobile phone has become a necessity rather than a luxury in today’s world. This has inflated the sales of mobile phones from GST-registered dealers.
Healthy Competition: The uniformity in prices after the implementation of GST on mobile phones has helped promote healthy competition among sellers.
Fair Competition from E-commerce: Under the older regime, online players bought mobile phones from states with lower VAT and sold them in states with higher taxation. The GST has reduced this gap to a great extent.
The GST regime has made the taxation system simple and straightforward. In order to learn more about GST and its implication for other kinds of goods and services, you can visit Bajaj Markets!
The HSN code applicable on mobile phones is 8517.
The applicable GST on mobile accessories is 18%.
GST encourages healthy competition among smartphone dealers while increasing sales. It also reduces the fraudulent sale of smartphones that online dealers used to previously source from the states at lower tax rates.
The smartphone GST rate is 18%.
Discounts given before or during the sale that are subtracted from the trade value at that time are exempt from GST.
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