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India Trade Implores Govt. to Lower Import Duty
Jan 18, 2022 10:30 AM
By Rapaport News
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RAPAPORT... The Indian diamond industry has repeated its calls for a reduction in import taxes on polished, saying this would help the country compete with other global trading hubs.
The Gem & Jewellery Export Promotion Council (GJEPC) has urged the Indian government to lower the duties to 2.5% from the current level of 7.5%, the trade organization said Monday.
The government raised the tax rate in September 2018 in a move that increased the costs for companies sending polished diamonds to India from other countries. The request, which comes ahead of next month’s Union Budget, is the sector’s second appeal for a tax decrease following a similar bid in July 2020.
“India is emerging as a potential global leader in jewelry exports,” said GJEPC chairman Colin Shah. “Such favorable export and domestic policies would help elevate the gems and jewelry exports sector and lay a foundation for [its] quantum growth. The only way to further scale up this sector is through policy reforms which will make us more competitive in the global market.”
The council also called for the government to allow miners to sell rough diamonds in Mumbai’s Special Notified Zone (SNZ) — a dedicated trading center in which producers can hold viewings without incurring income tax. Companies should also be able to reimport 10% of total polished-diamond exports without paying duty, the GJEPC urged.
“This will not only help the Indian diamond industry to remain as the largest producer of diamonds in the world but would also help us to become the largest diamond-trading hub,” Shah explained.
The council has also requested that the import tax on cut and polished gemstones drop to 2.5% from 7.5%. Precious metals, such as gold, silver and platinum, should be reduced to 4% from 7.5%, the GJEPC said, noting this would help India become “the number-one exporter of jewelry in the world.” In February 2021, the government granted the trade’s request for lower duties on gold and silver, reducing them to 7.5% from 12.5%.
The government will present the new budget on February 1.
Image: Polished diamonds and tweezers. (Shutterstock)
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Tags:
Colin Shah, diamonds, Gem & Jewellery Export Promotion Council, GJEPC, India, Polished Diamonds, Rapaport News, SNZ, special notified zone
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