Effect of GST on Gold Prices in India
Goods and Service tax is just few hours away from implementation. Most of us are wandering about the changes that will come with this new tax structure. GST will bring a certain level of rise and fall of charges that we currently pay for all the services and products.
When it comes to Gold, the impact of GST will bring a marginal rise in the overall pricing. The total tax will increase from 12.4 percent to 14 percent, raising the initial cost of buying a INR 100 worth of Gold from INR 125.60 to INR 127.20, this figure includes the custom duty, making charges and GST.
After charging 10% custom duty on Gold, the excise and value added tax that first made 1% and 1.2 percent will change to 3 percent GST. The government will even charge GST of 5 percent on the making charges of 12 percent, making things expensive at the end.
This certain move is expected to be beneficial for big players that work under the organized jewelry sector. The gap between them and the unorganized sector will come down, ultimately pushing more customers into their side.
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