GST Rate Cut On ACs, TVs, Home Appliances Will Revive Consumption Demand In India: Industry Leaders

India's electronics and appliance industry leaders praised GST rationalisation as a landmark reform that will simplify taxation, increase disposable incomes and boost consumer demand.

The government reduced GST on key home appliances like air conditioners, big-screen televisions, dishwashers, refrigerators, washing machines, vacuum cleaners, microwave ovens and other home appliances from 28 percent to 18 percent, making them more affordable for the festive season. The GST rates for smartphones and laptops remain unchanged at 18 percent

Pankaj Mohindroo, Chairman of the India Cellular & Electronics Association (ICEA), said the GST overhaul creates predictability and strengthens the foundation for growth.

He said the reduction of GST on air conditioners and televisions from 28 percent to 18 percent was especially welcome.

This was a long-standing demand of the industry, which will make appliances more affordable, unlock domestic demand, and boost consumption, vital for scaling India’s electronics manufacturing, he added.

Jitin Makkar, SVP and Group Head, Corporate Sector Ratings, ICRA Limited, said that retailers and e-commerce platforms are likely to leverage this change through promotions, further amplifying the impact.

While cautioning that supply chain challenges remain due to import dependence for certain bill-of-material parts, he was hopeful that the move would improve affordability and revive consumption demand that has been subdued lately.

The GST rationalisation strategically supports discretionary spending, he said, adding that lower taxes on appliances and home entertainment products will make them more affordable, encouraging upgrades and first-time purchases.

Arjun Bajaj, Director of Videotex, said that the reduction of GST on televisions from 28 per cent to 18 per cent tax cut would encourage upgrades to larger screen sizes, adding that festive timing makes the decision more impactful.