Industry & Economy
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Consumer Electronics
Consumer electronics majors not to cut prices post-VAT
Our Bureau
Mumbai
,
March 18
CONSUMER electronics manufacturers have decided to stay away from price cuts in contradiction to consumer expectation in the post value added tax (VAT) regime beginning next month.
"We have witnessed a delay in purchase decisions based of the perception that prices will fall, but the association has decided to hold back on price cuts," Mr D. Shivakumar, Vice-President, Western Region, Consumer Electronics and Television Manufacturer Association (CETMA), said.
While the CETMA members including LG, Samsung, Onida, Philips, Videocon, Godrej, decided to stay away from price cuts in a meeting held last week, they also discovered an increase in tax incidence by 1 per cent post VAT.
"The duties and tax components post VAT computes to 1 per cent higher incidence of tax, which will be absorbed by the manufacturers," said Mr Shivakumar.
As CETMA members are committed to offering their products at affordable prices, this increase will not be passed on to the consumer but absorbed by the manufacturers, the association release stated.
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