Gems and jewellery body seeks import duty cut
All India Gems and Jewellery Domestic Council (GJC) is seeking a reduction in import duty on gold to revive the jewellery industry which is currently witnessing a slowdown.
The council has written to the finance ministry seeking a reduction in import duty from 12.5 percent to 6 percent. The jewellery industry was hoping for a reduction in the last budget but on the contrary, the import duty was increased from 10 percent to 12.5 percent.
With gold imports down 15 percent and jewellery business dropping 30 percent by volume, the jewellery industry is confident of a favourable move by the government in the upcoming budget.
“A reduction in import duty will help ease demand. We are hopeful of a favourable move and expect to see gold demand similar to the levels of 2018, in the upcoming year,” in a statement said Anantha Padmanabhan, chairman, GJC.
“Gold imports were down by 10%-15% y-o-y in 2019 and added that business saw a drop of 30% by volume in the last six months. As a result, quite some jewellery workshops shut operations. We are working with World Gold Council and Metal Focus to gauge the situation. Over the next 6 months, we hope to come up with an estimation of how many shutdowns were seen,” he added.
The gems and jewellery sector is currently reeling under high taxation and poor demand in the international market. The council claims that the industry saw an increase in gold smuggling due to high import duty as buyers were also opting to purchase gold from countries like Dubai, Nepal, Sri Lanka, and Singapore.
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