It’s taken the shine out of many a wedding across the country over the past few days. Jewellery shops all over India have been closed since March 2. They are opposing finance minister Arun Jaitley’s budgetary proposal for a 1% excise duty without input tax credit or 12.5% with input tax credit on non-silver jewellery. That apart, Jaitley has made it mandatory for providing PAN card details for jewellery purchases of Rs 2 lakh or above. While jewellers may argue on the increased burden on them, it is a sensible move to bring in a lot more clarity on gold purchases in the country. It will also bring in a fair degree of checks and balances on jewellery purchases.
FM Jaitley has done well by not succumbing to the pressure to withdraw the proposal and he should stick to his stance; after all, this is not the EPF tax that hurts millions of taxpayers. What this does is hopefully bring some degree of sanity to jewellery purchases in the country and is essential for a movement to the goods & services tax (GST). The big plus is that it will also help the government identify people who need to pay taxes, but have been avoiding simply because there was no way to monitor heavy-duty jewellery purchases.
