By sending them a text message, Indian Bullion & Jewellers Association (IBJA) has created a panic among its customers that till the current fiscal year ends, the centre may put a stop on country’s gold imports. for depositing the old notes, the government may also pre-pone the last date for jewellers to November 15.
The national secretary of IBJA, Surendra Mehta told that there is nothing officially declared for gold import ban and advancement of deposit date and we hear this from certain circles. There is a chance of a possibility of such action as the association is supportive of the government’s fight against black money. Also informed to its members. To support the government wholeheartedly, we have told to our members. till November 8, to disclose their sales Already, 600 jewellers have received notices from the tax department. at a hefty premium only to sell the same gold is imported by certain members of the trade against old notes and We are aware of this. And then it might consider a ban on imports if the regime wants to stop this malpractice. Alternately, if it directs all jewellers to deposit or declare old notes from November 15, it would not necessarily look at banning imports.”
As from midnight of November 8, The government had demonetised 500 and 1000 rupee notes. The note holders asked to deposit them into banks by December end. The possible decision to encourage pre-pone the deposition of an old note for jewels may be ascribable to the fact that more or less of them enabled people in getting rid of their black money. At that place are some jewellery makers who were selling INR 50000/- for 10gms of gold, when the actual cost was only INR 30000/- which is again the old currency notes.
Rs 2000 new notes have already entered the market. Very soon new notes of Rs 500 will also launch. From the time government has put a 1% duty on jewellery, The gold market is officially down from this year and for sales over 2 lakh INR the customer has to give the PAN. the sales also reduced as there is 27% increase in the price of gold.
As there is a rumour on social media about the possibility of the centre banning gold imports till the end of this fiscal. So Jewellers of the country are tensed and ask deposition of demonetized than the previously announced date currency notes to be deposited earlier.
To gold bars and coins the government is trying to prevent changing the black money. On black money, a 200% penalty on tax will be charged that is declared.
If the government will start this movement and continue visit about, then smuggling of gold will increase and jewellers are worried about that.
After crude oil and products, electrical and nuclear equipment, the fifth largest import by the country is Gold. By increasing the customs duty to 10% and levying 1% customs duty, the current and past governments have put a jolt on the industry on jewellery.
People should invest in sovereign gold bonds and revamped gold monetization instead of physical gold as per the government.
Every year on average, India imports 700¬-750 tonnes of gold and a 15-¬20% fall is anticipating by the Industry.