India seems to have shelved PC tax plans Apple opposed
While it’s not over until it’s over, India’s government appears to have finally shelved its original plan to lay a huge tax on imported PCs in favor of a new scheme it says it will announce by the end of the month. That’s likely good news for Apple and other PC makers.
But places industry on watch
A Reuters report tells us the government is now consulting with the industry with a view to putting together new regulations for these imports. In the meantime, India’s trade secretary Sunil Barthwai told importers, “to be on close watch,” for the regulations when they appear.
The back story here is that around two months ago India announced that products including laptops, tablets, and computers would be placed under a licensing system starting in November.
Under that system, manufacturers importing these devices would have been forced to pay a levy.
Industry fought back
Manufacturers including Apple opposed these plans and it seems they fought back.
Originally India announced the cancellation of these proposals, before dumping them October 13, 2023. The abandonment isn’t complete, of course, as India still intends putting some kind of system in place.
Manufacturers will be hoping for a fair system that recognizes the cost and challenge of setting up a supply chain in India. Apple and its partners will particularly feel they are already making massive investments in India and will surely hope for some concessions on the basis of those multi-billion-dollar investments they already make there.
So far, Apple has confined iPhone and AirPod production to India, while PCs are manufactured elsewhere. It is known its partner, Foxconn, wants to make computers in India.
Apple maintains its investments
India’s PC market grew 5.9% quarter-over-quarter and declined by 15% year-over-year, according to IDC. The market there is at present driven by education and government projects. Overall, India’s IT spending should grow around 2.6 percent this year, according to Gartner.
Meanwhile, Apple plans to increase manufacturing capacity in India fivefold over the next five years from $7b to $40b value of production, according to earlier reports.
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