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Branded or unbranded gold jewellery will not attract excise duty. The Finance Ministry has rolled back the budgetary proposal of levying such a duty.
Buckled under severe pressure, the Finance Minister, Mr Pranab Mukkherjee, announced: “The proposal to levy excise duty was aimed with the Goods and Services Tax (GST), but it seems that people are not ready for it, so I withdraw it.’’
This withdrawal will be in effect from March 17.
This budget proposal had not gone well with the bullion merchants. They went on strike for 21 days. They were demanding a complete rollback as they were apprehending such a provision would bring inspector raj.
Hike in threshold limit
Mr Mukherjee also announced hiking the threshold limit for tax collected at source on cash purchase of jewellery from Rs 2 lakh to Rs 5 lakh.
The same threshold will be applicable for bullion items such as coins below 10 grams. However, for all other bullion items, tax deducted at source will be levied at the cash purchase of Rs 2 lakh or more. The rate will be 1 per cent.
The Finance Minister while announcing the budget had said: “In order to reduce the quantum of cash transactions in bullion and jewellery sector and for curbing the flow of unaccounted money in the trading system of bullion and jewellery, it is proposed to provide that the seller of bullion and jewellery shall collect tax at the rate of 1 per cent of sale consideration from every buyer of bullion and jewellery, if the sale consideration exceeds two lakh rupees and the sale is in cash. This would be irrespective of the fact whether buyer is a manufacturer, trader or purchase is for personal use.’’
Relief on immovable property
The Finance Minister also announced rolling back the proposal of levying tax deducted (TDS) on the sale of immovable property (other than agricultural land). The proposal was to get TDS at the rate of 1 per cent.
The proposal was that every transferee, at the time of making payment or crediting any sum by way of consideration for transfer of immovable property (other than agricultural land), will deduct tax, at the rate of 1 per cent of such sum.
The threshold limit for this proposal was Rs 50 lakh in six metros while Rs 20 lakh in other cities.
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