The Jewellery Industry and the 2009 Union Budget

The following measures were announced by the Finance Minister, Mr. Pranab Mukherjee as part of the 2009 Union Budget. On behalf of the industry, we thank the Gem and Jewellery Export Promotion Council (GJEPC) whose efforts brought about these changes.

• Extension of interest subvention of 2 percent on rupee export credit beyond the current deadline of September 30, 2009 to March 31, 2010
• Abolition of Excise Duty on Branded Jewellery
• Abolition of Fringe Benefit Tax
• Exemption of Service Tax on services received by exporters from goods transport agents and commission agents, where the liability to pay service tax is ab initio on the exporter. No need for the exporter to first pay the tax and later claim refund.
• Service Tax exemption for other services received by exporters would be operated through the existing refund mechanism based on self-certification of the documents where such refund is below 0.25 percent of FOB value and certification of documents by a Chartered Accountant for value of refund exceeding the above limit.
• Service Tax exemption to all Export promotion Council’s and FIEO on the membership and other fees collected by them till March 31, 2010.
• Extension of sun-set clauses for the tax holiday (deduction in respect of export profits available under sections 10A and 10B of the Income-tax Act) by one more year i.e. for the financial year 2010-11.
• Increase in customs import duty on Gold Bars from INR 100/10 gm to INR 200/10 gm
• Increase in customs import duty on other forms of gold like Tola Bars, medallions and coins excluding jewellery from INR 250/10 gm to INR 500/10 gm
• Increase in customs import duty on silver excluding jewellery from INR 500/ kg to INR 1,000/ kg

Courtsey GJEPC Sphere: Related Content