IGST News, Photo, Video and Current Affairs

Gem & Jewellery Exporters Exempted from 3% IGST on the supply of Gold by Nominated Agencies from January 1, 2019. In a major relief, the Union Government has accepted apex body - The Gem & Jewellery Export Promotion Council’s (GJEPC’s) demand to grant IGST-related exemption on the supply of gold by Nominated Agencies to exporters of articles of gold. The GST Council recently announced that gem & jewellery exporters will no longer have to pay 3% IGST to nominated agencies (banks) from 1st January 2019. Mr Pramod Kumar Agrawal, Chairman, GJEPC, said, “We commend this step undertaken by the Government. On recommendations of the Council, the GST Council ruled that it was satisfied and it is necessary in public interest to exempt the intra-State supply of gold falling in heading 7108 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when supplied by Nominated Agency under the scheme for "Export Against Supply by Nominated Agency.” We are also expecting a similar relief from Govt. to the exporters of articles of silver & platinum very soon. Mr Agarwal added, “The upfront payment of IGST and Import duty in the form of bank guarantee had further led to the huge working capital blockage for various small and medium jewellery exporters, increased interest cost, hassles of compliance to claim refund thus consequently impacting their business operations & global competitiveness.” Post implementation of GST Regime and 3% IGST on gold, the industry had requested for the IGST exemption on the supply of gold by nominated agencies to exporters. Thereafter, the Government of India vide Notification No. 77/2017-Customs dated 13.10.2017 had exempted specified banks and Public Sector Units (Nominated Agencies) from payment of IGST on import of gold but the same had not benefitted the jewellery exporters as they still had to bear the upfront payment of IGST/GST and the basic import duty to the tune of 10% on procurement of gold for the purpose of manufacture of export of jewellery. GJEPC is also pursuing key pending GST Issues … With respect to the blockage of the input tax credit (‘ITC’) due to inverted duty rate structure. Effective 25th January 2018, the GST rate on cut and polished diamonds and gemstones has been reduced from 3% to 0.25%, while GST rate of 5% (job work charges)/18% (others) applies on input services, leading to accumulation of ITC qua domestic supplies. GJEPC’s Recommendation: Single GST tax rate regime of 0.25% across the entire value chain for diamonds/coloured gemstones/semi-precious gemstones. Exports made on a consignment basis (including for foreign exhibitions, export promotion tours etc.) As the goods sent on a consignment basis for the purpose of foreign exhibitions, export promotion tours is not a supply, GST should not be levied on goods exported for such purpose or when reimported back. GJEPC’s recommendation: Clarification to be issued to provide with regard to an exemption for consignment import and export of gems and jewellery through exhibition/export promotion tours Refund of the accumulated tax credit on account of inverted duty structure on input for a certain period Refund claims filed on account of inverted duty structure being denied, a substantial amount has been accumulated which has led to the capital blockage of the diamond/coloured gemstone exporters. GJEPC’s recommendation: Necessary instructions be issued to permit a refund of accumulated ITC pertaining to the stock of the stated products held as on the date of the rate change. In addition to the above issues, GJEPC has also taken up the issue pertaining to import of gold on a consignment basis for manufacture and export of jewellery.

Tag: IGST

Most Read

DMCC Set to Join Natural Diamond Council as It Deepens DUBAI’S

The Luanda Accord expands as Namibia joins, GJEPC and DMCC move toward Natural Diamond Council membership

Chairman and Vice chairman of GJC on “Zero duty on export of gems and diamonds” announced

WHO’S COMING TO GEMGENÈVE IN 2026?

EDITOR PICKS

DMCC Set to Join Natural Diamond Council as It Deepens DUBAI’S

The Luanda Accord expands as Namibia joins, GJEPC and DMCC move toward Natural Diamond Council membership

Chairman and Vice chairman of GJC on “Zero duty on export of gems and diamonds” announced

POPULAR POSTS

DMCC Set to Join Natural Diamond Council as It Deepens DUBAI’S

The Luanda Accord expands as Namibia joins, GJEPC and DMCC move toward Natural Diamond Council membership

Chairman and Vice chairman of GJC on “Zero duty on export of gems and diamonds” announced

POPULAR CATEGORY

ABOUT US

FOLLOW US