Gold Industry Seeks Sizeable Cut in Import Duty

The customs duty on gold currently stands at around 15%, including an agricultural infrastructure cess of 2.5%.

SEATTLE (Scrap Monster): The Indian gold jewellery industry expressed hopes that the government will announce reduction in customs duty on gold in the upcoming Union Budget to be presented on 1^st February, 2023.

The customs duty on gold currently stands at around 15%, including an agricultural infrastructure cess of 2.5%. In order to trim the rising current account deficit (CAD), the government had raised the gold duty. The decision led to significant reduction in gold imports by the country from around 1,068 tonnes in 2021 to 706 tonnes last year. The increased duty structure also sent gold smuggling to new heights.

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In its request to the Finance Ministry, the Gem & Jewellery Export Promotion Council (GJEPC) demanded that the import duty on gold, silver and platinum be reduced from current levels to 4%.

Vipul Shah, chairman, GJEPC noted that the high import duty on gold is draining off the capital from the exporters. Moreover, it has turned out to be a key generator of economic malpractices in the country. The reduction of customs duty to 4% will not only help to reduce the blockage of working capital of exporters, but also contribute towards creating a healthy and transparent industry.

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