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Government exempts IGST on gold imports

However, gold refineries, which import more gold or unrefined gold, will have to pay 3% IGST

Rajesh Bhayani  |  Mumbai 

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The government has issued a notification allowing 36 and five canalising agencies, including MMTC and MSTC, to import gold without paying a 3 per cent integrated (IGST). It’s a big relief for financial institutions importing gold, as the 3 per cent tax was an additional burden on them. 

Till now, importers’ working capital used to get blocked until they got the refund on paid. However, the new notification removes that hurdle and smoothens the process of import. Analysts say on a consignment basis, which had almost stopped after the implementation of the GST, will resume again. So far, most import was happening as gold metal loans usually by

In the case of consignment import, an importer kept gold ready in stock and it was priced when sold. This was helpful as sudden demand helped to give virtually spot delivery. However, due to the 3 per cent payable on imports, and other agencies had stopped it. The latest notification doesn’t change anything for traders who will have to pay 10 per cent import duty and 3 per cent and claim back the as input credit. Gold refineries that import or unrefined gold, will have to pay the and hence, they are at a disadvantage compared to refined  

Surendra Mehta, national secretary, Indian Bullion and Jewellers Association, said, “Removing the on and not on dore imports (gold dust) will kill Indian industry.”

First Published: Tue, October 17 2017. 01:49 IST