Budget Reactions – Arshit Pathak, Kingtech Electronics India
Arshit Pathak, MD, Kingtech Electronics India (A group company of G’Five international), shares his post Union Budget 2011 reactions with CXOtoday.com.
“1) There has been a marginal increase in MAT (Minimum Alternate Tax) from 18% to 18.5%. This poses a tax burden on telecom service operators who seem to be spending fortunes already in other resource intensive activities like 3G network roll out etc. This shall have a bearing on their plans to acquire new customers and increase the tele-density. Therefore, it has an indirect effect on the sale of new mobile handsets. Our growth as a mobile handset brand is linked to theirs.
2) The Government has increased the duty by 1%. This is inflationary and shall result in increase in the prices of handsets. However, it all depends on the mobile handset brand whether or not it passes this increase completely or partly to the customer or absorbs it fully. G’Five Mobile is a brand that caters to the mobile communication needs of the masses which are already burdened by price rise. For many, mobile phone is a secondary requirement after the basic necessities. Therefore, as a socially responsible brand, we have taken a conscious decision not to burden them further by any resultant or ensuing price rise. We shall not pass it on to the customer and absorb it completely for the larger benefit of this segment of buyers, irrespective of what others brand in competition resort to.
3) The Finance Minister has also announced the faster roll out of GST (Goods & Services Tax). This is a positive move which shall ensure overall growth of the industry and we at G’Five welcome this.”
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