India plans to slash gold import duty to arrest smuggling

New Delhi: The Centre is all set to cut the import duty on gold because higher taxes have made it more profitable for smugglers, government officials said. The decision was taken considering that smugglers were using the opportunity to offer hefty discounts and denting the market share of banks and refiners, he said. “The duty cut by the world’s second-biggest consumer could lift retail sales by making gold cheaper ahead of peak demand season and support global prices. It could also revive operations of local gold refineries, which nearly suspended refining for the past two months as they could not compete with grey market operators,” reported Reuters. “The government is considering bringing the effective gold rate to below 12%. The proposal is being discussed. We will take a final call soon,” a government official, who did not wish to be identified, told Reuters. “The effective duty on gold is currently 18.45%, which includes 12.5% import duty, 2.5% agriculture infrastructure development cess and other taxes,” it said. Earlier, this month M.P. Ahammed, founder and chairman, Malabar Gold & Diamonds told PTI “India needs a robust gold policy which will rationalise gold import duty to curb gold smuggling, boost exports of gems and jewellery and empower organised jewellery retail to capture the domestic gold jewellery demand spectrum with ethically sourced gold. The commerce ministry was discussing a reduction in import taxes on gold to rein in illegal shipments, according to sources in the ministry. According to World Gold Council data, India’s gold imports fell 23% in July-September from the same period a year ago following the tariff increase. Read all the  Latest News ,  Trending News ,  Cricket News ,  Bollywood News , India News  and  Entertainment News  here. Follow us on  Facebook,  Twitter and  Instagram.