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Understanding the Impact of GST 2.0 on Electronics and Automobiles

Tina TinaChouhanbyTina TinaChouhan
September 22, 2025
Understanding the Impact of GST 2.0 on Electronics and Automobiles

India’s long-anticipated GST 2.0 reform officially launched on 22 September 2025, transforming the country’s indirect tax system with a simplified two-slab structure. While numerous household electronics are expected to become more affordable, smartphone users—particularly those interested in high-end models from Apple, Samsung, and Xiaomi—might be disappointed. The new system aims to simplify compliance and reduce the tax burden for both consumers and businesses. Under this revised structure, several everyday electronics like televisions and air conditioners have experienced reduced GST rates. The government justified this reduction by emphasizing their increasing importance as household necessities amid changing lifestyles and climate-related requirements. However, the GST on smartphones remains unchanged at 18%, leaving prices stable.

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Consequently, popular premium devices such as the Apple iPhone 17 Pro Max, Samsung Galaxy S25 Ultra, and high-end Xiaomi models priced above ₹50,000 will not benefit from any tax-induced price cuts. Laptops also remain in the same tax category, raising questions about whether these devices—essential for contemporary work and education—should have been classified as necessities. Buyers will need to rely on seasonal discounts and exchange offers for potential savings. The rollout of GST 2.0 aligns with the onset of India’s festive shopping season, prompting e-commerce platforms to launch aggressive promotions.

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Amazon’s Great Indian Festival (AGIF) 2025, commencing on 23 September, anticipates significant deals on smartphones, tablets, wearables, and accessories from brands like Samsung, Apple, OnePlus, iQOO, Xiaomi, realme, and Lava, with Prime members receiving 24-hour early access. Similarly, Flipkart’s Big Billion Days sale is expected to offer substantial discounts across electronics and lifestyle products, including Apple AirPods Pro (2nd Gen), Samsung Galaxy Book 4 laptops, iPads, boAt soundbars, and Philips grooming items. While smartphones did not see any tax relief, the automotive sector emerged as a major beneficiary of GST 2.0. The government reduced GST on small cars from 28% to 18%, prompting leading manufacturers to announce price cuts.

This change is anticipated to make car ownership more affordable for Indian consumers and enhance auto sales during the festive season. Overall, the government’s recent reform is regarded as a significant move toward GST simplification, yet its selective nature has drawn mixed responses. While televisions and air conditioners are now more affordable, smartphones and laptops—crucial for modern connectivity and work—remain at their previous price levels. For consumers, the immediate benefit lies not in the tax reform itself but in the upcoming festive sales that promise attractive deals. Meanwhile, the automotive sector’s gain reflects the government’s initiatives to stimulate demand in a vital industry.

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