FM says not viable to rollback hike in import duty on gold

Finance Minister Pranab Mukherjee

The Parliament on Wednesday, gave its nod to the first part of the Union Budget 2012-13. However, it has asked finance minister Pranab Mukherjee to consider the rollback of tax proposed for unbranded jewellery, to which the FM said he will make the announcements on the same in the second half of the session.

However, Mukherjee ruled out removal of rise in import duty on gold while addressing the Rajya Sabha. "For rollback of tax on unbranded jewellery, you will have to wait till (debate on) the Finance Bill that we are examining, but please don't insist on reduction of import duty (on gold). Import duty reduction is not possible," said Mukherjee.

The finance minister said that he would also have another look at the proposal on quoting of PAN compulsory for buying gold jewellery over Rs 2 lakh.

Post the announcement of Budget 2012-13, many bullion traders from several parts of the country went on strike as a protest to Mukherjee’s proposal of tax for unbranded jewellery.

Giving his stance on the proposed tax, Mukherjee said that there would be ‘no scrutiny’ if jewellery traders can give a ‘self-declaration’ that their turnover is below Rs 5 crore.

Speaking further on double custom duty on gold and platinum to 4%, Mukherjee said, India cannot lose foreign exchange on such imports, thus it was not viable to rollback the hike.