GST 2.0: Why India's Electronics Sector Welcomes It And Awaits A Festive Boost

GST 2.0 spans electronics, EVs, drones, and renewables, offering lower costs, clearer policies, and simpler compliance. Its success depends on how rapidly the gains flow through, aligning India's industry with global tax frameworks.

- By SHUBHA MITRA

GST, launched in 2017 to overhaul India's indirect tax regime, remains a work in progress eight years later. Electronics and other price-sensitive sectors still feel the weight of frequent tweaks. On 3 September 2025, the GST Council cleared its most sweeping reform to date, merging rates into two slabs, 5% and 18%, while keeping 40% for demerit goods. Having seen over 500 revisions since inception, the system continues to adapt. From 22 September, the new framework is expected to ease household costs, lift sectors such as drones and EVs, and finally bring long-promised simplicity.

Electronics cheaper, sellers gear up for festive season

GST cuts have eased rates on consumer durables, with TVs, refrigerators, washing machines, air-conditioners, and dishwashers dropping from 28% to 18%, reducing prices by ₹1500-₹2500. Retailers like Croma and Reliance Digital are rolling out discounts, exchange offers, and online deals up to 70% to spur festive demand. Other items, such as electric accumulators, ignition equipment, and select electronics, also see steep cuts, while mobiles and laptops stay at 18%. The reform relieves big-ticket appliances while keeping high-volume goods stable.

Gagan Sharma, Managing Director of XElectron, notes how GST 2.0 could reshape consumer choices: "The timing makes this move even more impactful, as the revised rates will come into effect during the festive season, when people actively purchase and gift electronics, giving a boost to the consumer electronics market."

Drones: Lifting off with tax clarity

India's drone sector, long hindered by fragmented taxation ranging from 5% to 28% depending on camera integration, finally has clarity. Commercial drones will now uniformly attract 5% GST, while defence drones, high-performance batteries, and critical communication systems are fully exempt.