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India Hikes Taxes on Polished Imports

Feb 4, 2018 3:55 AM   By Rapaport News
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RAPAPORT... The Indian government has increased import taxes on polished diamonds to 5%, prompting criticism from the Gem & Jewellery Export Promotion Council (GJEPC).

The levy applies to cut and polished diamonds, both natural and laboratory-grown, and to colored gemstones, Finance Minister Arun Jaitley said in a budget speech Thursday. The new rate — up from 2.5% — is one of several changes to customs-duty rates aimed at protecting local industry. Jaitley also raised import taxes on imitation jewelry to 20% from 15%.

However, the decision damages the nation’s ability to compete with other diamond-trading hubs such as Belgium, Dubai and Israel, GJEPC chairman Pramod Agarwal said in a statement the same day.

“We are disappointed with the increase in customs duty…as it was not included as part of the industry’s recommendations to the government,” he noted. “This move hampers India’s chances of becoming an international diamond-trading hub.”

Even so, Agarwal welcomed the government’s efforts to develop India’s gold industry, and said the GJEPC would seek a reduction in import duty on gold, silver and other precious metals. Meanwhile, the decision to lower corporate tax for companies with annual revenue above $38.9 million (INR 2.5 billion) will benefit the gem and jewelry trade, he noted.
Tags: Arun Jaitley, Belgium, diamond, Dubai, finance, Gem & Jewellery Export Promotion Council, GJEPC, India, Israel, Pramod Agarwal, Rapaport News
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