Gems and jewellery industry wants GST of 1.25 %
November 26, 2016. 19:37 IST
A jewellery shop owner in Karol Bagh asserts that higher GST will force the jewellers to resort to tax evasion and black marketing.
The gems and jewellery industry in the country wants the government to reduce the proposed 4% Goods and Service Tax (GST) for gems and jewellery sector to 1.25%, if the latter wants the entire industry to be "organised and compliant".
All India Gems and Jewellery Trade Federation (GJF) Chairman G V Sreedhar claimed that 1.25% GST will generate more tax revenue than what the current tax system is generating.
"There is 1% of VAT (value added tax) on jewellery across the country. In addition, there is excise duty of 1% that is applicable to just 10-15% jewellers with manufacturing turnover of Rs 10 crore, so about 85% jewellers do not come under excise duty purview," Shreedhar said.
"GST will be applicable for the revenue threshold at Rs 20 lakh, bringing almost all under its purview. In our analysis, we have found that 1.25% of GST will contribute more than what one per cent VAT and 1% excise duty combine together is contributing. We do not want the government to lose its revenue, but our industry should also not suffer," he said.
Shreedhar said about 75% of the sector is still not organised. "We want the sector to be organised."
According to sources, a delegation of GJF officials met Union Finance Minister Arun Jaitley to highlight various concerns of the sector including the GST.
A jewellery shop owner in Karol Bagh asserted that higher GST will force the jewellers to resort to tax evasion and black marketing. He claimed that it will further add to the non-compliance.