Samsung Apple

An industry body made up of Samsung and Micromax has asked the government to rethink its customs duty on accessories, claiming foreign brands such as Apple are gaining an unfair advantage. In this year's financial budget, the government announced that a 29% customs duty would be levied on all accessories (batteries, adapters, chargers, speakers, and headsets) that are imported by brands manufacturing locally in India. In contrast, foreign vendors importing accessories as completely built units are charged 12.5%.

In a bid to promote its "Make in India" initiative, the government increased the import tax on phones from 6.5% to 12.5%. And as Apple does not have a manufacturing facility in India, it pays a tax of 12.5% on all phones and accessories it brings into the country.

Samsung locally manufactures all phones sold in India, but imports accessories. With cost of accessories amount to nearly 40% of the total manufacturing cost, local vendors are at a disadvantage when compared to the likes of Apple.

In an interview with ET Tech, Ravinder Zutshi, chairman of the mobile arm of the Consumer Electronics & Appliances Manufacturers Association said:

There is an anomaly in duties which the government should look into, as it will benefit only a few brands like Apple which are currently importing finished goods and have no manufacturing investment in India as compared to all the other smartphone makers who are investing in India.

As of now, the local vendors have submitted a plea to the government to correct the import duties. The move comes on the heels of the IT department's dismissal of Apple's bid to sell used iPhones in the country.