GJC urges govt to rollback import duty on gold; seeks comprehensive integrated policy to save gems and jewellery sector

Reduction in gold duty will directly reduce social and economic menace in the country, he said.

Press Trust of India July 31, 2019 16:41:34 IST
GJC urges govt to rollback import duty on gold; seeks comprehensive integrated policy to save gems and jewellery sector
  • The import duty of 12.5% plus GST of 3% has made gold jewellery costlier which is negatively impacting consumer sentiment

  • The gems and jewellery sector engages 55 lakh labour force

  • The industry body also urged the government for exemption from capital gain

Mumbai: All India Gem and Jewellery Domestic Council (GJC) on Tuesday urged the government to rollback the import duty of gold to 10 percent and implement a comprehensive integrated gold policy to save the gems and  jewellery sector.

"The government should rollback gold import duty till the time revised gold monetisation is implemented as that is the only feasible substitute to reducing gold imports," GJC chairman Anantha Padmanaban said in a release here.

Reduction in gold duty will directly reduce social and economic menace in the country, he said.

"The 10 percent import duty on gold was levied to curb Current Account Deficit (CAD) but India's fiscal deficit  narrowed down in FY19. On one hand, the government talks about taking Indian craftsmanship to the world while on the other hand its policies are making our skilled artisans leave the business with all their learnings, experience and expertise," he pointed out.

GJC urges govt to rollback import duty on gold seeks comprehensive integrated policy to save gems and jewellery sector

Representational image. Reuters.

The import duty of 12.5 percent plus Goods and Services Tax (GST) of 3 percent has made gold jewellery costlier, which is negatively impacting consumer sentiment, he said.

The gems and jewellery sector engages 55 lakh labour force, he said.

"The lack of demand in the sector has resulted in many craftsmen and artisans being out of work and shifting to other businesses, where they are getting employment," he added.

GJC vice chairman Shaankar Sen said, "the government should implement gold policy immediately to liberalise and  simplify Gold Monetisation Schemes to recycle household gold for utilisation."

The government should act as a facilitator to encourage households and temples to deposit the idle gold lying in their possession by imposing limits, he added.

The industry body also urged the government for exemption from capital gain as per Section 54F of the Income Tax Act 1961, for new jewellery after selling old ones.

"This will help the industry to move towards organised and compliant business practices. In case of remaking of new jewellery from old jewellery or old gold, 18 percent GST is applicable on labour charges. Due to high rate of GST, the customers are reluctant to go for this option. The other option left with customer is to sell the old jewellery and buy new jewellery. However, in that case there is capital gains tax involved," Sen added.

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