In a bid to check unbridled imports of gold and, thereby, contain the widening current account deficit (CAD), the government, on Tuesday, raised the tariff value of gold to $521 per 10 grams to render its imports costlier.
According to a notification issued by the Central Board of Excise and Customs here, the fortnightly tariff value of gold — the base price on which customs duty is determined to prevent under-invoicing — stands increased to $521 from $516 per 10 grams in March. The tariff value for silver, however, has been lowered to $920 from $930 a kg.
Increasing imports of gold has been identified as one of the major factors responsible for the burgeoning CAD for the December quarter.
Even as the government raised the gold tariff value in the wake of a firm price trend in the global market, it is clear that the increase in import duty of gold earlier from 4 to 6 per cent has largely failed to yield the desired results.