| Mumbai is losing out to neighbouring cities in the silver trade too due to a steep levy of 2 per cent octroi on the white metal.
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| Octroi levy in Gujarat and Rajasthan is nil, making the trade in Maharashtra, particularly in Mumbai, highly uncompetitive.
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| Considering silver as a bullion metal, the Maharashtra government, through its notification in January 2003, had levied a uniform sales tax on both gold and silver.
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| Since April 2005, the introduction of the value added tax (VAT) has brought a uniform one per cent tax on both the metals in the state.
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| However, with regard to octroi levy, the Municipal Corporation of Greater Mumbai (MCGM) still considers silver as part of products under Group D of Schedule II, while gold is considered as part of Group E of the same schedule.
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| The differentiation has resulted in a varied octroi levy structure for both gold and silver and articles made thereof since April 27, 2000.
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| As per a notification of the MCGM in July 2002, the products under Group D are levied an octroi of 2 per cent ad valorem and those in Group E are levied an octroi at 0.1 per cent.
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| Harmesh Arora, vice-president, Bombay Bullion Association, points out that both gold and silver need to be considered part of bullion and should be clubbed under one group. Further, the octroi levy should also come down to 0.1 per cent ad valorem.
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| The products under Group D include sugar, precious metals, silver and articles made thereof, diamonds, natural pearls, precious and semi-precious stones and aeroplanes, helicopters, components and parts and accessories thereof. Group E on the other hand contains bullion, specifically gold.
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| Currently only about 50 tonne of silver per year comes into Mumbai, however, the potential for silver imports are at roughly 1,000 tonne per year. |
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Content Guide
