Bullion and jewellery markets remained closed for the seventh day today in various parts of the country to protest doubling of import duty on gold and imposition of excise duty on unbranded jewellery.
While markets in Mumbai and Chennai were closed for ‘Gudi Padwa’ festival, jewellery traders in other parts of the country continue the indefinite strike called by various associations.
Market sources claimed that the industry has lost business of over Rs. 6,000 crore in the last six days and it might rise further with more markets like Uttar Pradesh and neighbouring areas joining the protest.
Bullion traders in Kanpur has joined the strike as nearly 368 jewellery shops remained shut. Traders have also threatened to take to the streets if the Centre did not roll back the duty hike.
Traders are protesting against the budget proposal imposing excise duty of one per cent on unbranded precious jewellery and doubling of customs duty on standard gold bars and coins to four per cent.
Uttar Pradesh Bullion Traders Association President Shyam Bihari Mishra said that new tax proposals would lead to rise of ‘licence raj’
All India Sarafa Association President Sheel Chand Jain said that a letter in this regard had been sent to Finance Minister Pranab Mukherjee demanding roll-back of the budgetary proposals.
“The proposed increase in import duty will lead to unchecked smuggling of the metal. This increase of import duty should be withdrawn in the larger interest of the trade and consumers,” the letter had said.
Traders warned that imposition of higher levies may lead to a rise in retail gold prices by over six per cent in the country, which is seeking to rein in a widening current account-deficit partly fuelled by record purchases in 2011.
Imports may fall over 35 per cent this year from a record 969 tonnes in 2011, while the industry might face more difficult time in coming days as marriage season begins, traders said.
Keywords: customs duty, Union Budget, bullion strike
Governent should look to measures to curb the generation of Black Money. Curbing savings of poor persons money invested into Gold is making the country poor. Jewellery sector protest is the procedure not the revenue for the country. The Jewellery is manufactured in India piece to piece ,design and weight basis.Maintaining separate account for every piece is cumbersome and non explainable and subject to mistakes.Excise department has lot of corruption and excise laws are very stringent.Instead Goverment should levy on turnover slabs.Jewellers want simpler laws which they can abide by. The point of attraction of excise duty in Jewellery sector is very confusing.Even they are difficult to explain by Excise officers and legal consultants.How can multiple individual pieces which are subject to change / repair its weight on the need of customer /change because of slow movement /change its removal of part of Jewellery/removal or addition of gold beads or beads.
how can one co relate black money with excise duty.for your information now in india one kg gold is one lakh more expensive as compared to dubai.black money will be used to import gold through smuggling route.jewellers are ready to pay more tax in the form of vat but introduction of excise will make keeping records more complicated.most of the jewellery is made by small artisians who are illiterate and are not in position to maintain complicated excise records.customet is not ready to pay current vat.how can you expect them to pay additional taxes.
excise duty in gold jewellery wiii encourage inspector raj only. if govt want to increase the income. they should increase the custome duty only.
The actual excise duty on gold jewellery is only 0.3% of the sales value as duty is charged on tariff value which is only 30% of sales value. For example, if a person purchases jewellery valued at Rupees one lakh, the duty payable is only Rs. 300/-. This is only a very small amount in comparison to the value of jewellery. Though the jewellers' say that "increase in price may curtail demand", the truth is that the demand has only increased even though there was an increase of more than Rs. 1000/- per gram of gold (i.e. Rs.10000/- for 10 gm.) in the last few years. So what is the real reason behind this protest? It is an open secret that huge amount of black money is being invested in gold. The government has made it very clear that the levy
of excise duty on jewellery is a step to curb black money than garnering revenue. So all the citizens of the country should support he government in the fight against black money and corruption.
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