Jewellers Fear Import Duty Hike On Gold And Silver .

Traders fear that the government might raise import duty on gold and silver in Budget. If a duty hike is announced, it will be the third successive year of such a move.

The industry fears that an increase in the import duty may lead to smuggling and inflow of gold in the country through NRIs.

“We expect that import duty on gold and silver will be increased this year. Even the high prices did not deter the spirits of the consumers from buying these shinning metals which may lead to an increase in the import duty,” said Ram Parkash, president of Ghumar Mandi Jewellers Association.

Despite a manifold increase in prices, the duties were not reviewed between 2004 and 2009. In 2009, the government raised the duty on silver from Rs 500 to Rs 1,000 per kg.

The duty on gold bars was raised from Rs 100 per 10 gram to Rs 200 per 10 gram and on other forms of gold (excluding jewellery) from Rs 250 per 10 gram to Rs 500 per 10 gram.

In 2010, the import duty on gold was raised by Rs 100 to Rs 300 per 10 gram and by Rs 500 to Rs 1,500 per kg on silver. If the duties are increased then NRIs might play a substantial role in bringing gold to India.

“Lot of Punjabis are settled abroad and if import duty is increased then gold will flow into the country through them," added another jeweller Sikhri Chand from Sarafan Bazar. Another jeweller from Chaura Bazar said there is a speculation that the import duty on both gold and silver may be increased.

“Gold may be smuggled into the country if the import duty is increased which may lead to wide gap between the global and Indian prices,” he added.

Source : tribuneindia.com