Excise Duty on Gold - No Rollback because of organised agitation - FM
YESTERDAY the Finance Minister replied to a Calling Attention in the Rajya Sabha on imposition of Central Excise Duty on the gold jewellery by the Government leading to resentment among jewellers in the country: -
Several public debates have also taken place on this issue for the past some weeks. I have also had talks with the people associated with this business. I have got an opportunity to understand their grievances as well. A plea was given that bigger ones were exempted while smaller ones were taxed. But the fact is quite contrary to this. This excise duty has not been imposed on any small jeweler. According to the exemptions provided, if the turnover of anyone during the last year was under 12 crore rupees and is less than 6 crore rupees in the next year, he is exempted. I would like to clarify that it will be enforced upon the traders having turnover of 12 crores and 6 crores of rupees and not on lower category of traders. We can decide the items which can be taxed.
It is not possible to recall the tax due to some organised agitation.
The State of Kerala is on the top in the list of the states which have taxed the gold by imposing 5 percent tax and the same books have to be maintained. Imitation jewellery is taxed at 6 per cent excise in this country. When the small items are being taxed in the country, then there is no reason that a luxury item should be kept outside the tax net. If we are moving towards the GST, gold has to be taxed. GST council will decide the tax rate, but the main issue is whether the upper cap should be within the constitution or outside of it. If you want to have luxury items out of GST, then you will have to enhance the duty on essential items to maintain the 18 percent cap. It is not possible to keep luxury items out of taxation indefinitely. We can maintain a reasonable cap by taxing these items. Keeping in view the various features of the gold trade, no physical verification will be done by any authority. You have to pay the tax on self certification. We are also ready to extend more facilities for avoiding any type of harassment of the traders. We have formed a committee in which three nominees are to be from the trader's side. 206 traders have registered themselves till date and we have also extended the registration date. The Centre has no other option but to impose excise tax. As and when GST is implemented, VAT imposed by the States and central excise will be merged. Then, they have to pay tax on all items, including the luxury items. I would also like to condemn the wrong propaganda in this regard and assure you that small traders will be out of its ambit.