|Chennai||Rs. 27770.00 (-0.14%)|
|Mumbai||Rs. 29200.00 (2.31%)|
|Delhi||Rs. 27900.00 (-0.36%)|
|Kolkata||Rs. 28270.00 (1%)|
|Kerala||Rs. 27050.00 (-0.37%)|
|Bangalore||Rs. 27550.00 (1.66%)|
|Hyderabad||Rs. 27770.00 (-0.14%)|
Despite finance minister Pranab Mukherjee's denial of any possibility of reversing the customs and excise duties proposed in the recent Budget on their trade, jewellers are continuing their effort in this regard. Around 1,000 jewellers from across the country are gathering tomorrow in Delhi to decide on the next course of action, beside lobbying their respective legislative representatives.
According to Prithviraj Kothari, president of the Bombay Bullion Association and managing director of gold retailer Riddi Siddhi Bullions, "After three days of closure, we are going to open our shops on Tuesday. But we would continue our protest through all means."
Meanwhile, jewellers extended their strike, which was to end today, by another two days.
In response to the jewellers' agitation, Mukherjee had said on Saturday that "pressure tactics won't work". Jewellers say they will not give up their opposition to the extension of excise duty into unbranded jewellery and ornaments' movement from export-oriented units to the domestic tariff area. "The duty hike would bring 'inspector raj' back, which the industry was experiencing 25 years ago. It will also empower the inspectors of customs, excise and various other departments to harass jewellers, which we would not support under any circumstances," said Bachhraj Bamalwa, chairman of the All India Gems & Jewellery Trade Federation, the organisation spearheading the protest.
The government considers gold an unproductive asset, which helps massive foreign currency outgo and widens the current account deficit. The industry contests this and the government's "dictatorial-type decision". "We are simply bringing out the issues emerging from Budget proposals, to protect the industry," said Bamalwa.
In January, the customs duty on gold was raised from one per cent to two per cent. In March, it was raised to four per cent, a 300 per cent rise in less than three months. India's jewellery demand is already down due to falling disposable incomes of the average middle class, because of rising inflation. A further duty rise will drive away demand, said Bamalwa.
As for the extension of excise duty, he said, the decision would also promote money laundering, as customers would prefer non-invoicing of their purchases. In the zero duty regime, gold smuggling was unprofitable. Now, with the levy of four per cent customs duty, the smuggling of gold may resume.
"We failed to understand, why jewellery, as a retail business, has been brought under TDS (tax deduction at source) net. Most jewellery purchases are executed without any PAN card. Asking women to buy and sell old jewellery with a PAN card for cash payment over Rs 200,000, for which a TDS certificate would be delivered at her doorstep later, is impractical to execute," said Rajiv Popley, director of Popley & Sons Jewellers, a renowned institution here.