It has been happening in the last two years that the custom duty on gold has been increasing. This has been so to contain the current account deficit. The government has used this as a measure to contain the deficit. Early last year on 17th January the import duty was Rs.300 per ten grams of standard gold. This is in regard to the standard gold of 99.9%or above purity.
During the stated date the duty was increased from 2% w.e.f hence in the 2012-2013 budgets the duty raised to 4%. Earlier this year on 21st January it was raised to 6%w. e. f and by 5th June the duty raised to 8%w. e. f. lately on 13th august the duty was revised further to 10%.
Custom Duty increases from 10 to 15 percent on jewelleries made of gold and silver. Beside the custom duty on gold skyrocketing over time the duty for silver has also been revised frequently. On 17th January 2012 the duty was 6%w. e. f; silver price by then was Rs.1, 500 per kg. In 13th august 2013 the duty on silver was increased by 4% making it 10%w. e. f. Not only gold and silver have been affected by the increasing duty but also platinum. The platinum duty has been revised in tandem with that of gold.
Regarding the custom duty on articles concerning jewellers especially those made of gold and silver were not revised. It seems that the raised duty rates never affected the all silver or gold ware articles. Articles of jewelry and goldsmiths or silversmiths’ wares remained unchanged in conjunction with the duty rates changed. The duty on those articles was 10% and still it.
The jeweler making industry is one of the most labor intensive industries. There million of artisans that depend on this industry to make their living. These who all depend on this sector are also required to pay taxes to support the government. When the government varies the duty between the gold silver or platinum and that of the jewelry then this shows that some consideration was not fully evaluated. The Indian jewelry industry will never compete as required with the cheap imported jeweler. There is a difference of almost 8% on gold jewellry and 4% in the case of the silver ones. To protect our industry the government should at least consider lowering the duty rates s this will position the local industry on the same platform with the imported jewelry. The imported jewelry is Machine made making it cheaper to produce it. The Indian jewelry is hand made hence their cost of production is high, making their market price also high.
In order To protect our valuable taxpayer ; the artisan the custom duties on the article of jewerally mainly on those from goldsmiths’ or that of silversmiths’ wares has been issued and it has been increased from 10% to 15%. The notification of this issue was issued early today.
PIB Press release Sept 17