World Gold Council Market update: GST's impact on India's gold market Donnerstag, 08. Juni 2017 - 09:08
Market update: GST's impact on India's gold market
On 1st July, India's labyrinth of taxes will be replaced with a simple, nationwide Goods & Services Tax (GST). While this radical step forward could present short-term challenges, we believe it will make the gold industry more transparent and efficient, benefiting the gold industry and gold buyers.
The simplified taxation structure will make the gold supply chain more transparent and efficient. It should also boost India's economy which in turn will support gold demand
Key points:
At 3%, the GST rate announced on the 3rd June was lower than the industry had feared. Industry reaction has been positive.
There are two important GST rates which will affect the gold industry: the 3% tax on gold products – which replaces the excise duty and VAT components, but sits on top of the import duty – and an 18% tax on services, which will affect small-scale artisans who design and manufacture jewellery for larger manufacturers.
While the overall tax rate consumers face is likely to increase slightly, GST will bring benefits too. Firms will be able to offset the GST they pay against their revenues, and double taxation throughout the supply chain will be eliminated. Supply chains will become more efficient.
World Gold Council 10 Old Bailey, London EC4M 7NG United Kingdom T +44 20 7826 4700 F +44 20 7826 4799 E marketintelligence@gold.org W gold.org
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