GJEPC Once Again Requests Reduction in Gold Import Duty

(IDEX Online News) – The Gem and Jewellery Export Promotion Council (GJEPC), India’s jewelry and diamond industry umbrella organization, has once again requested that the government ease import duty on gold. The organization is asking that the tax be reduced from its current 10-percent level to 2-percent to help increase finished jewelry exports.

The GJEPC says that the gem and jewelry sector, with is the second-largest contributing to the Indian government, has experienced a drop in exports in the last 12 months and it puts the blame on attempts by the government and the central bank to curb imports on gold to help reduce the current account deficit.

“Since the imposition of 80:20 scheme, the desired curb in the total import of gold has now been duly achieved,” says Vipul Shah, chairman of the GJEPC. “So the import duty should be rolled back to much lower rate say 2 percent.”

Shah argues that the current 10-percent duty makes smuggling economically viable. “If the import duty is rolled back then the menace of gold through smuggling route will [no longer be] productive and hence the leakage will be prevented. More so, the smuggling of gold is dangerous to the overall export business and reputation of the Indian sector as per Responsible Gold and Dodd Frank Act.”

The GJEPC says there is a possibility that its duty reduction proposal may get accepted in part or completely before the last session of parliament.