Apple has announced a price cut in iPhone models. Customers can save substantially on the purchases. The cut in prices was 3-4 percent across all the iPhone models. At the same time, purchasers of Pro or Pro Max can save ₹5100 to ₹6000. Therefore, iPhones, from 13 to 15 models, will be cheaper by ₹300 while the iPhone SE model will see a reduction of ₹2300.
This price cut is a huge departure in strategy for Apple. Earlier, Apple stopped Pro models when new generations were launched and let dealers and resellers clear old inventories with discounts. The manufacturer’s suggested retail price of Pro models were never cut officially. The experts cited by Economic Times said this was the first time Apple cut prices directly on its Pro models.
The price cut has been announced following a reduction in the basic customs duty on mobile phones from 20% to 15% in the Union Budget 2024 announced by the Finance Minister on July 23. Other than mobile phones, the reduction will also apply to circuit board assemblies for mobile phone manufacture and chargers.
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Understanding the new tax structure
While under the current structure, imported smartphones attract an 18% GST and a 22% customs duty. Thus, budgetary changes have now brought down the basic customs duty to 15% with a surcharge of 1.5% remaining in effect, making for a total customs duty of 16.5%. India-made phones attract only the 18% GST, making them further competitive.
Apple has gradually ramped up domestic production in India. Currently, 99% of the mobile phones it sells are made locally in India, with some specific premium models being an exception as they get imported. Its local production strategy benefits the consumers in the form of lower prices and aligns with India’s ‘Make in India’ initiative, thus driving growth and jobs.