HSN Code for Mobile Phones: Simplifying Taxation
Every time you buy a mobile phone or any other product in India, you must have come across a unique identification code on your invoice. This code is known as the Harmonized System of Nomenclature or HSN Code. It is a standardized system of names and numbers used to classify goods in international trade transactions. HSN codes have been introduced in India to simplify tax collection and compliance under the Goods and Services Tax (GST) regime. In this article, we will discuss everything you need to know about HSN Code for Mobile Phones.
What is HSN Code for Mobile Phones?
HSN Code for Mobile Phones is 8517. It covers all types of mobile phones – feature phones, smartphones, refurbished phones, and accessories like chargers, batteries, earphones, protective cases, etc. The HSN Code for Mobile Phones helps in identifying the appropriate tax rate under the GST system.
How to determine the tax rate for Mobile Phones using HSN Code?
The GST rate for Mobile Phones varies depending on its value and features. Mobile phones falling under the HSN Code 8517 are taxed at 12% GST rate, whereas accessories are taxed at 18%. However, there are some exceptions, like if a phone is imported, the IGST (Integrated Goods and Services Tax) of 18% has to be paid.
For example, if you buy a mobile phone that costs ₹10,000, the GST levied would be 12% of the total cost, which is ₹1,200. Similarly, if you buy a mobile phone charger that costs ₹100, you will have to pay 18% GST, which is ₹18.
Benefits of HSN Code for Mobile Phones
Earlier, the classification of goods was based on varied practices, which became cumbersome and confusing for taxpayers. With the implementation of HSN Code, taxpayers can now correctly classify their goods, which minimizes errors and reduces the chances of non-compliance. It also helps in identifying the correct tax rate applicable for a specific product, leading to transparency and simplification of indirect taxes.
Conclusion
In conclusion, HSN Code for Mobile Phones is essential for tax compliance and is an efficient tool in simplifying taxation for businesses and taxpayers. By using HSN Codes, businesses can avoid errors and control compliance costs, and the tax authorities can efficiently assess and collect taxes. Therefore, it’s crucial to understand the HSN Code for Mobile Phones and its correct usage for better compliance under the GST regime.
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