Technology Budget 2024: Customs duty on mobile phones, PCBAs cut; FM Sitharaman’s 5 key steps for IT & electronics

In her record-breaking seventh Union Budget in a row for the fiscal year 2024-25, Finance Minister Nirmala Sitharaman on July 23 announced some crucial measures to promote the information technology and electronics sectors. 

The minister revealed a reduction in customs duties aimed at lowering input costs, enhancing value addition, promoting export competitiveness, rectifying inverted duty structures, and boosting domestic manufacturing. These changes will take effect on July 24, 2024.

Key announcements in IT and Electronics

1. Cellular mobile phones

• Customs duty is reduced from 20 per cent to 15 per cent.

2. Chargers/adapters for cellular mobile phones

• Customs duty is cut from 20 per cent to 15 per cent.

3. Printed Circuit Board Assembly (PCBA) for cellular mobile phones

• Customs duty slashed from 20 per cent to 15 per cent.

4. Specified goods for use in the manufacture of connectors

• Customs duty is down from 5-7.5 per cent to nil.

5. Oxygen-free copper for use in the manufacture of resistors

• Customs duty is reduced from five per cent to nil.

These changes are expected to bolster the IT and electronics sectors, foster a more competitive market and support domestic manufacturers.

Meanwhile, the FM also announced major changes to the income tax structure in the Budget 2024. Key takeaways include an increase in the standard deduction for salaried employees from ₹50,000 to ₹75,000, and a hike in the family pension deduction from ₹15,000 to ₹25,000. 

The new tax regime features revised slabs, with income up to ₹3 lakh exempt and rates rising progressively to 30 per cent for income above ₹15 lakh. No changes were made to the old tax regime. These reforms are expected to result in a net revenue loss of approximately ₹7,000 crore annually.