Indian Tax Solution

No roll back on jewellery: CBEC
New Delhi, Mar 19 : The Central

Board of Excise and Customs (CBEC) on Monday ruled out rolling back the one per

cent excise duty on jewellery as proposed in the Union Budget for 2012-13,

saying the effective rate of tax is marginal and the government needs to raise

more resources to fund its subsidies bill.

“We will soon issue

clarifications and there should be no apprehension in this regard,” said CBEC

chairman S.K. Goel while addressing a post-Budget seminar organised by The

Associated Chambers of Commerce and Industry of India (ASSOCHAM).

He said the effective excise duty on jewellery could be in the range of Rs 90

per 10 grammes. Small artisans who design and create jewellery for goldsmiths

will not have to face the hassle of registration for duty payment.

Bullion traders are unhappy over extension of one per cent excise duty to

unbranded precious metal jewellery and have threatened to go on indefinite

strike.

The government has also doubled import duty on gold to four per cent. India, the

world's largest consumer of gold, imported 967 tonnes of the precious metal in

2011.

To reduce the quantum of cash transaction in bullion and jewellery sector and

for curbing the flow of unaccounted money in the trade, the government has

proposed that a jeweller should collect one per cent tax from every buyer if

sale consideration exceeds Rs two lakh.

Goel said the Budget for 2012-13 was guided by declining GDP growth rate to 6.9

per cent in current financial year and the need for fiscal consolidation.

Domestic manufacturing, agriculture, power, mining and textile sectors need to

be encouraged, and the Budget aims towards it.

Ved Jain, chairman of ASSOCHAM national council on direct taxes, said the Budget

is a balancing exercise between government expenditure and income. This time, it

has been a balancing between politics and economics as well.

The Indian economy has fared well despite the Eurozone debt crisis but the

balance of payments is under stress.

Jain said there is huge expenditure to be incurred on account of subsidies – the

major areas involved being oil imports, food security and providing education to

all.

ASSOCHAM secretary general D.S. Rawat said the Budget is well-balanced and

pro-active with well-defined measures to bring back the economy on higher growth

track.

Despite the global economic situation coupled with domestic political

compulsions and challenges like elevated inflation, the government has tried to

tread the path of fiscal consolidation with prudent macro-management.

“It also emphasises the need for fresh investments for capacity creation and

infrastructure building on the public private partnership model,” he said.

Source :http://www.indiablooms.com

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