New tax boosts illegal mobile devices in India

india_flagWe’ve reported on India’s continuing struggle against illegal mobile activity. “Grey market” devices with no ID code have been an on-going problem in the country. And a recent 12.5% VAT hike on mobile devices in the Western Indian state of Maharashtra has driven legal mobile sales down by 75%

According to the Indian Cellular Association (ICA), sales of mobile devices in Maharashtra have dropped 75% between the start of June and July. This follows a tripling of the VAT charged on mobile phones. The monthly sales of mobile devices in that region is usually around 1 million units. The ICA claims this figure will drop by up to 80% if the new VAT is not removed.

Via Business Standard

From the report:

Pankaj Mohindroo, National President, ICA: “The three fold hike in the tax burden can only result in a complete lose-lose situation for all stakeholders. The dismal sales records of the first ten days show that the grey market is back with a vengeance.”

What we think?

India has had repeated problems with mobile crimes, from spam to illegal imports. If there’s such a thriving market for illegal phones in the country, I’m not sure why the powers that be in Maharashtra thought a massive tax increase would be a good idea in the first place.

About Cian O' Sullivan

Ace reporter, Cian, has moved on from GoMo News. He is currently the office manager for Photocall Ireland - Ireland's premier news and PR photography agency. You can check out the site at www.photocallireland.com. If you want to contact him directly about anything, Cian's new email is cian at photocallireland dot com.
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