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Uttrakhand based bullion refineries benefit from GST

The incidence of tax on them will be lower by 78 basis points in the GST regime

Rajesh Bhayani  |  Mumbai 

GST, tax

refineries in the excise free zone of will be in an advantageous position in comparison to those in other areas of the country (domestic tariff area) in the goods and services tax (GST) regime.

The incidence of tax on them will be lower by 78 basis points in the regime.

Rudrapur in houses 17-18 refineries, which work on dore bullion, or unrefined imported gold. There are about 37 such refineries in the country, the rest of them in the domestic tariff area. 

Currently, refineries in zones pay a (CVD) of 8.75 per cent and 0.2 per cent entry tax, making the total 8.95 per cent. Compared to that, the domestic tariff area refineries pay a CVD of 9.35 per cent. Now under the GST, which will be three per cent for both types of refineries, Uttarakhand-based refineries will get 52 per cent of the central component, which is half of the three per cent GST, as refund. This means their net will be 2.22 per cent, while other refineries will pay three per cent. 

has offered an excise holiday for five years to attract investment, and, as a result, refineries have set up shop in the state in the past three years. 

Even after the excise duty was levied on gold by the Centre last year, refineries were better-placed than other refineries.

The GST, which will come into force in July, will subsume all special tax benefits.

Refineries in Uttarakhand, when approached, did not comment on the matter.

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Uttrakhand based bullion refineries benefit from GST

The incidence of tax on them will be lower by 78 basis points in the GST regime

As the excise and VAT being replaced with a single tax rate GST, bullion refineries situated in excise free zone of Uttrakhand stand to gain and their edge in terms of lower incidence of duty over refineries in other areas of the country known as domestic tariff area will rather increase from 0.40 per cent to 0.78 per cent.Rudrapur in Uttrakhand, a hilly state of north India houses some 17-18 refineries refining dore bullion or unrefined imported gold. There are about 37 such refineries in the country, rest of them in domestic tariff area. Uttrakhand has offered excise holiday for five years to attract investments which attracted bullion refineries in last three years to the state. Even after excise duty was levied by the center, last year, on gold Uttrakhand refineries were better placed compared to other refineries.The Goods and Service Tax which will come in to force from July was supposed to subsume all special tax benefits but including all taxes like excise, entry tax and VAT. ..
refineries in the excise free zone of will be in an advantageous position in comparison to those in other areas of the country (domestic tariff area) in the goods and services tax (GST) regime.

The incidence of tax on them will be lower by 78 basis points in the regime.

Rudrapur in houses 17-18 refineries, which work on dore bullion, or unrefined imported gold. There are about 37 such refineries in the country, the rest of them in the domestic tariff area. 

Currently, refineries in zones pay a (CVD) of 8.75 per cent and 0.2 per cent entry tax, making the total 8.95 per cent. Compared to that, the domestic tariff area refineries pay a CVD of 9.35 per cent. Now under the GST, which will be three per cent for both types of refineries, Uttarakhand-based refineries will get 52 per cent of the central component, which is half of the three per cent GST, as refund. This means their net will be 2.22 per cent, while other refineries will pay three per cent. 

has offered an excise holiday for five years to attract investment, and, as a result, refineries have set up shop in the state in the past three years. 

Even after the excise duty was levied on gold by the Centre last year, refineries were better-placed than other refineries.

The GST, which will come into force in July, will subsume all special tax benefits.

Refineries in Uttarakhand, when approached, did not comment on the matter.
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Business Standard
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Uttrakhand based bullion refineries benefit from GST

The incidence of tax on them will be lower by 78 basis points in the GST regime

refineries in the excise free zone of will be in an advantageous position in comparison to those in other areas of the country (domestic tariff area) in the goods and services tax (GST) regime.

The incidence of tax on them will be lower by 78 basis points in the regime.

Rudrapur in houses 17-18 refineries, which work on dore bullion, or unrefined imported gold. There are about 37 such refineries in the country, the rest of them in the domestic tariff area. 

Currently, refineries in zones pay a (CVD) of 8.75 per cent and 0.2 per cent entry tax, making the total 8.95 per cent. Compared to that, the domestic tariff area refineries pay a CVD of 9.35 per cent. Now under the GST, which will be three per cent for both types of refineries, Uttarakhand-based refineries will get 52 per cent of the central component, which is half of the three per cent GST, as refund. This means their net will be 2.22 per cent, while other refineries will pay three per cent. 

has offered an excise holiday for five years to attract investment, and, as a result, refineries have set up shop in the state in the past three years. 

Even after the excise duty was levied on gold by the Centre last year, refineries were better-placed than other refineries.

The GST, which will come into force in July, will subsume all special tax benefits.

Refineries in Uttarakhand, when approached, did not comment on the matter.

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Business Standard
177 22