Thursday, October 19, 2017

GST effect: Customers could end up paying more tax on jewelry making
Sunday, June 4, 2017 - 8:02:36 PM - By NEWS BUREAU
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Customers could end up paying more tax on jewelry making
MUMBAI: The decision of the Goods and services Tax Council to levy 3 per cent GST rate on gold, silver and diamond jewelry has come as a relief to the bullion, gems and jewelry industry. However, media reports suggest customers could indirectly end up paying more, as a result of levying of tax on jewelry making.

This will have a negative impact, given that hand-made jewelry will be levied GST at 18 per cent. This will be in sync with similar other 'services' under GST. The All India Gems & Jewelry Federation (GJF) has sought clarity on this, and other issues like collecting GST from consumers who make advance payment for jewelry, according to media reports.

“If the tax on labor intensive jewelry is 18 per cent, like the filigree type, the jeweler will recover that from the customer,” media reports quoted Sanjeev Agarwal, CEO, Gitanjali Export Corp as having said. “Since a separate slab has been created for gold, we assume that a similar rate would apply to job work.”

GJF has requested the Indian Government that GST should be applicable at the time of sale, in addition to applying GST at 3 per cent on job work, GJF Chairman Nitin Khandelwal was quoted as having said in media reports.

The GST Council is scheduled to have one more round of meeting on June 11. The Gold and Jewelry industry is hoping that the issues will get sorted out - positively.

The India Bullion and Jewelers Association Ltd. (IBJA) has been quoted in media reports as having asked for clarity on standardization of billing, where the GST rates on gold and making charges are mentioned separately.

Apart from the 10 per cent import duty, a jeweler charges customers a per cent each of VAT and excise on ornament sales, the media reports said.

(C) A MEDIA INC./ THE INVESTORS INSIGHT / I N D I A/ 2017
The India Bullion and Jewelers Association Ltd
IBJA
GST Council
GJF Chairman Nitin Khandelwal
Sanjeev Agarwal
CEO
Gitanjali Export Corp