KOLKATA:
 The next fortnight is crucial for the gold trade in the country as it will make a last ditch effort to keep GST (goods and services tax) on gold below 2 per cent. Trade bodies are trying to meet Union finance minister Arun Jaitley, all state finance ministers and other senior bureaucrats and secretaries before June 3 when they will reconvene to fix the rate on gold.

The GST Council, which had met last week in Srinagar, had fixed the rates for 1,211 items under four GST slabs — 5 per cent, 12 per cent, 18 per cent and 28 per cent. But it did not take a call on the rates of some items such as gold, and put it off to June 3.

"At present, gold attracts an excise duty of 1 per cent and a VAT of 1 per cent apart from a 10 per cent import duty. Kerala is asking for a 5 per cent GST as it is the only state in the country that has put a 5 per cent VAT on gold. But the trade wants 1.25 per cent GST on gold as a higher rate will hamper growth and will result in a drop in tax compliance by the gold trade," Nitin Khandelwal, chairman, All India Gem & Jewellery Trade Federation (GJF), told ET.

GV Sreedhar, past chairman, GJF, argued that if GST is kept low, then the government’s tax earnings will increase. "We will ensure that the industry becomes tax-compliant," said Khandelwal. GJF will approach all state finance ministers with its proposal from Tuesday onwards.

 24 May 2017, 11:34 AM