New Delhi, Feb 29 (ANI): Finance Minister Arun Jaitley on Monday announced impose of one percent excise duty on gold and diamond jewellery, which comes as a blow to the sector.
The India Bullion and Jewelry Association (IBJA) fears the introduction of the excise duty will lead to job loss in the gem and jewellery sector.
The domestic imitation jewellery sector has received an impetus as the government has increased the basic customs duty on imported imitation jewelry from 10 percent to 15 percent.
The size of imitation jewellery is around Rs. 12,000 crore and it is growing at a rate of 25 percent to 30 percent annually.
China and Korea have already captured 30 percent of the Indian imitation jewellery market.
In his Budget speech today, Jaitley proposed to levy one percent excise duty on jewellery without input credit or 12.5 percent excise with input credit.
The IBJA said that levying of excise duty on jewellery will create more trouble for this industry which is already starving. There are about one crore artisans working in the industry and most of them are likely to become jobless, the association feels.
However, the Economic Survey tabled last Friday hinted at higher taxes on gold.
Meanwhile, gold edged up on MCX by one percent after the announcement. The April contract was trading at Rs. 29,738 per 10 gm while the budget was being tabled and corrected at Rs. 29,590 soon after the budget speech was over. (ANI)