Union Budget 2023-24 ‘Critical concerns of Gems & Jewellery industry not met’

Team L&M

While the Gems and Jewellery Industry congratulates the Union Finance Minister Nirmala Sitharaman for presenting a well-balanced Union Budget 2023-24, focused on the spirit of Amrit Kaal, it rues the fact that the industry’s critical concerns have not been addressed in the Union Budget 2023-24.

“Even though the government has agreed to provide Research and Development grant to one of the IITs for the development of Lab Grown Diamond seeds and machines, the other sectors of the industry have been ignored,” says Saiyam Mehra, Chairman, All India Gem and Jewellery Domestic Council (GJC), adding that the reduction in Gold Custom Duty in this Budget was their big expectation as it has severely hampered the industry and encouraged smuggling and grey market. “GJC has been actively representing the reduction in customs duty of Gold over past many years,” he adds.

He further states that bringing Silver Dore Bars Custom Duty at par with Gold and Platinum will adversely affect the masses.

The Gem & Jewellery Export Promotion Council (GJEPC) too applauded the government for accepting its recommendation to promote indigenous manufacturing in the emerging Lab-Grown Diamond (LGD) sector by providing Research Grants to IIT for five years.

The ₹13.7 lakh crore investment for infrastructure is a big positive step for the country, which will unleash the potential of Indian economy.

“The reduction of Customs Duty on LGD seeds to zero from existing five per cent will ensure India’s end-to-end world leadership in rough to finished lab-grown diamond and jewellery manufacturing,” says Vipul Shah, Chairman, Gems & Jewellery Export Promotion Council (GJEPC).

Industry leaders say that the clear segregation customs – IT HS codes for Silver and Platinum studded Lab grown jewellery is a welcome step as it will lead to better differentiation and identification at consumer level. Another positive pro-growth move is that the conversion of physical gold into digital gold will not attract capital gains tax.

The GJEPC welcomes the move to increase the duty on articles (jewellery) of precious metals such as gold/silver and platinum from 20 per cent to 25 per cent. “But rationalizing the import duty on silver by proposing to increase the import duty on silver dore, bars and articles to align them with that on gold and platinum, which will have a net effect of increase of around five per cent duty at import level for silver resulting in increase of price for silver products domestically,” says Shah.

The industry is happy with the enhancement of Income Tax limit to Rs. 7 lakh as it will benefit workers in the gem & jewellery industry. Reduction in surcharge in the highest Income Tax slab will reduce maximum tax rate to 39 per cent from 42.74 per cent, which will benefit jewellers. The industry leaders hope that the PM Vishwa Karma Kaushal Samman package of assistance for traditional artisans and craftspeople will be extended to the 5000-year-old indigenous gem & jewellery business as well.

But industry demand for reduction in Import Duty on Gold/Silver and Platinum has not been met. “We will continue to pursue the same with the Government for the overall welfare of the industry,” says Shah.

“We are having a meeting with the Union Finance Minister Nirmala Sitharaman on February 04 and we shall once again stress upon our important concerns such as reduction in custom duty, EMI on Jewellery, relief in Capital Gain Tax and Gold Monetisation Scheme among others,” says Mehra.

Progressive Economic Document, says CAIT

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