Manufacturers to pay 1% duty on non-branded gold jewellery
THERE IS no reason for goldsmiths and artisans to have apprehensions as the government’s proposed 1 per cent excise duty on non-branded gold jewellery would have to be paid by manufacturers, said SK Goel, chair, Central Board of Excise and Taxes (CBEC).
“We will soon issue clarifications and there should be no apprehension in this regard,” said Goel while addressing a post-budget seminar organised by The Associated Chambers of Commerce and Industry of India (ASSOCHAM).
“As far as excise duty on non-branded gold jewellery is concerned, we have liberalised the way of implementing it. Goldsmiths and artisans won’t have to pay duty,” said Goel.
The duty will have to be paid by manufacturers of jewellery, and accounts will also be maintained by them, he added.
The effective excise duty on jewellery could be in the range of Rs 90 per 10 gramme. Small artisans who design and create jewellery for goldsmiths would not have to face the hassle of registration for duty payment, said Goel.
Bullion traders are unhappy over extension of 1 per cent excise duty to unbranded precious metal jewellery and have threatened to go on an indefinite strike. The Bombay Bullion Exchange was closed on Monday due to the protest by bullion traders and jewellers against these budgetary proposals.
The government has also doubled import duty on gold to 4 per cent.
To reduce the quantum of cash transaction in bullion and jewellery sector and for curbing the flow of unaccounted money in the trade, the government has proposed that a jeweller should collect 1 per cent tax from every buyer if sale consideration exceeds Rs 2 lakh. Ved Jain, chair of ASSOCHAM national council on direct taxes, said that the budget is a balancing exercise between government expenditure and income but his time, it has been a balance between politics and economics as well.
The Indian economy has fared well despite the Eurozone debt crisis but the balance of payments is under stress, he said. Jain added that there is huge expenditure to be incurred on account of subsidies — the major areas involved being oil imports, food security and providing education to all.
ASSOCHAM secretary general DS Rawat said that the budget is well-balanced.