(a) customs and excise duty rates in fixed phones and mobile phones; and
(b) the reasons that fixed line phone operators who do not charge the cost of instruments are being made to pay higher duties and taxes as compared to mobile phone handsets whose cost is paid upfront by subscribers and enjoying lower duties structure?
MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI S.S.PALANIMANICKAM)
(a) The customs and excise duty rates on fixed phones and
mobile phones are as follows:
(i) Both fixed phones and mobile phones attract nil basic
customs duty and 4% additional duty of customs under
section 3(5) of the Customs Tariff Act, 1975, w.e.f.
1.3.2005.
(ii) Cellular phones and radio trunking terminals are fully
exempt from excise duty. Other telephone sets including
fixed phones attract excise duty at the Cenvat rate of
16%.
(b) Exemption from excise duty was given to cellular phones
mainly to reduce the cost so as to reduce the incentive
for smuggling. The levy of customs and excise duties
does not depend on whether or not the cost of instrument
is recovered from the subscriber.