Reaction from Leading Jewellers on Proposed Hike in GST from 3% to 5%
Ishu Dattwani, Founder, Anmol Jewellers (MUMBAI)
There are and will always be the consumers who want to save on GST even its 3% but for organized players like Anmol Jewellers, we don’t succumb to such pressure and we do believe in abiding by the law. The proposal to hike the GST is ultimately affecting the reduction in Gold Duty so as far as the consumer is concerned, they will get the price benefit sooner or later as the rate/tax paid by the consumer will be compensated with the reduced gold rate in the future. The government is trying to streamline the duty structure as per international laws and as an industry, we should support the same.
Vaibhav Saraf, Director, Aisshpra Gems & Jewels (UTTAR PRADESH (Metro and Tier II)
The proposal to hike GST to 5% is detrimental as gold is an asset for consumers and being taxed at a higher slab reduces the viability of gold as an asset. This will also lead to an increase in the black marketing of gold as consumers will not want to pay higher taxes. This will result in increased smuggling of gold too. The current gold prices are lower in short term in long term the value of the yellow metal always increases and therefore hike in GST while prices are low doesn’t cushion the impact in any substantial way.
Shrey Mehta, Director, Pooja Diamonds (MUMBAI & GUJARAT)
The increased GST will definitely encourage unorganized trade of gold and adversely impact organized retailers of our scale. Organized retailers like us follow every government norm and support every new policy by implementing them. The consumers should be given more benefits for buying from an organized retailer and not taxed more instead. The jewellery industry is anyways undergoing a lot of transformations with policies like HUID and we hope that it isnt burdened with an increased GST as well.
Aditya Pethe, Director, WHP Jewellers(MAHARASTHRA, GOA, MADHYA PRADESH)
We hope that the hike in GST is not implemented as it increases the cost for consumers to buy gold even though the gold prices are steady like they are currently. Gold is a commodity that Indians buy not only for ornamental purposes but it is also one of the forms of savings and building assets and it should not have high taxes. Even a simple housewife who doesn’t understand other means of investment saves in form of Gold. Organized retail players will always sell with bills but this will encourage the unorganized sale of gold where the consumers will end up buying through unreliable sources who may not give the consumer legit products.
Broadly, this would encourage unorganized trade of gold and also make consumers vulnerable to scams. Gold prices keep fluctuating and short term dip in Gold prices will not as such cushion the impact of increased GST as the consumer will not be able to enjoy the benefit of steady gold prices.
Tanya Rastogi, Director, Lala Jugal Kishore Jewellers & Indian Bullion Jewellers Association (IBJA) (UTTAR PRADESH)
This is a very unwelcome move. This will only increase the movement of parallel economy. Already India is one of the more expensive places to buy gold. Added to that, this hike in duty shall render an already long-suffering industry, only recently recovering, another blow.