Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: ACCOUNTING STANDARDS :: articles on VAT and GST in India :: VAT RATES :: list of goods taxed at 4% :: VAT Audit :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: ACCOUNTING STANDARD :: empanelment :: Central Excise rule to resale the machines to a new company :: cpt :: TDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: due date for vat payment :: ARTICLES ON INPUT TAX CREDIT IN VAT
« VAT (Value Added Tax) »
 VAT exemption stays in tax reform bill
 Income Tax Appellate Tribunal Bangalore Banches Bangalore 'A' Bench DB Case Causelist for The Week from 22-05-2017 To 25-05-2017
 Amendments in Second schedule appended to Delhi Value Added Tax Act, 2004
 Haryana govt exempts solar devices from VAT net
 Court rules out VAT on Paradise equity transfer
 VAT gone but riddle of derivatives traded on commodity exchanges lives on
 Rule 2(L) Of Cenvat Credit Rules, 2004 Amended
 Haryana govt exempts solar equipment from VAT
 AP to push for same benefits under GST for VAT exempted goods
 Andhra Pradesh to push for same benefits under GST for VAT exempted goods
 Petrol prices set to rise in Goa with increase in VAT

Jewellers plea to sort out State gold VAT structure
February, 12th 2016

Kerala Jewellers Federation (KJF) has said that rationalising the tax structure for gold/reducing tax rate to one per cent would help promote the larger principle of a progressive tax system.

It would also be in alignment with the goals and objectives of Goods and Services Tax, the KJF said in a representation to the State government.

Negative implications

Under GST, in all likelihood, gold would be treated in the category of special goods that could either qualify for complete exemption or would be charged at the basic rate.

Reduction of VAT on gold would encourage both the dealers and customers to account all transactions and pay taxes. This would also lead to greater transparency in the VAT system, the KJF said.

It argued that lowering of VAT rates and simplification of the existing compounding system is likely to increase tax revenues and increase compliance.

The higher rate of VAT (five per cent) adversely affects sales and can potentially have negative implications on employment and the overall industry. It is estimated that with every 100-tonne reduction in domestic jewellery sales, roughly 2.5 lakh employees in jewellery manufacture and jewellery retail could potentially lose their jobs.

State’s responsibility

Given this context, it is the responsibility of the State government to protect the gold industry, said MP Ahammed, general secretary, KJF.

He requested the government to review the VAT policy applicable to the industry, and immediately amend the relevant Act.

The compounding tax mechanism is unscientific and places restrictions on the ability of a trader to claim input VAT credit.

This is seriously impacting the prospects of organised retailers and negatively impacting the regional economy.

With the exception of Tripura and Kerala, all states charge a VAT of one per cent for gold, silver and other ornaments or precious metals.

Kerala charges five times the rate prevailing in most states, which has invited unwanted economic effects, Ahammed said.

Black market

This high rate interferes with manufacturers’ input and output choices as also consumers’ consumption preferences.

It encourages stakeholders to device the supply chain structures for tax purpose only and not based on economic consideration.

It also creates artificial preference to one state over another based on tax rates which creates barriers for free flow of goods and services within the country.

A higher VAT rate as compared to neighbouring States combined with the compounding scheme, which is a lose-lose case for the dealers, has created a flourishing black market in Kerala.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Multi-level Marketing MLM India Affiliate Marketing Affiliate Marketing Software MLM Software MLM Solutions Multi level marketing solutions MLM Servi

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions