Mumbai: Mr. Nitin Khandelwal, Chairman, All India Gems and Jewellery Trade Federation (GJF) has expressed concern over unconfirmed reports that the Union Finance Ministry is being urged to work on a package to reduce the import duty of gold while increasing the GST (Goods and Services Tax) rates for the Gems & Jewellery sector.

“Based on Revenue Equivalent Principle, we had recommended 1.25% GST on Gold and jewellery. The Govt. has taken great caution and with great understanding introduced 3% GST on the Industry, which we warmly welcomed. The industry enjoyed a 1% VAT for over 17 years.  It is very difficult for me to accept that the Government will increase the GST.  Reduction in custom duty of gold/ bullion is a welcome initiative for the Gems & Jewellery Industry, but it should be delinked from tweaking existing GST rates for the domestic gems & jewellery sector. The present 3% is also challenging for the industry to absorb. Any change in the GST rates will negatively impact the gems & jewellery sector especially at a time when jewellers across India are in the process of switching over to uniform GST rate and complicated procedures therein. Also, there is major concern in the Industry wherein the Job work is at 5% GST, which we have already suggested the Government to keep a uniform rate of 3%. To encourage the gems & jewellery sector to become more organized, the Government had recently effected many changes for the benefit of the gems & jewellery sector. The gems & jewellery business is affected by poor sales and it will be extremely difficult for domestic jewellers to convince customers to pay higher GST rate. Policy makers and govt must have one voice and have to understand the plight of lakhs of small jewelers, manufacturers, craftsmen and artisans who find the new normal of 3% GST three times higher than what they were paying in pre-GST era.  We are confident that Union Finance Minister will support our industry and will act in the best interests of the indigenous gems & jewellery sector, which is a shining example of Make in India.”