The All India Gems & Jewellery Trade Federation (GJF)  East Zonal Chairman Sankar Sen, Immediate Past Chairman G V Sreedhar, Director - Manoj Jha, Zonal Committee Member Srimal Dholakia and office bearers of the  Patliputra Sarafa Association Binod Kumar and Bharat Mehta submitted a  representation on GST to the Hon’ble Finance Minister of Bihar Shri Abdul Bari Siddiqui and Hon’ble Commercial Tax Minister Shri Bijendra Prasad Yadav.    

In the memorandum to the Bihar Government, submitted through the two ministers, the GJF has proposed a GST rate of 1.25% for the gems and jewellery sector.

“Gold is a very sensitive product and cannot be taxed at higher levels. While the G&J Industry is now gearing up for the forthcoming GST era, higher GST rate will hamper the growth of the industry,” Sreedhar G. V., Immediate Past Chairman & Director, GJF, said explaining the apex organisation’s stance on the subject. “This will result in drop in tax compliances and revenue and will also encourage smuggling. There is an entire precedent on VAT collections in the past and 1% was the highest revenue collected from G&J industry. Therefore, GJF has proposed that the GST rate for the gems & jewellery sector should be kept at 1.25% with single HSN code similar to Excise, if the Govt. expects the industry to be compliant and get organised.”

Sankar Sen, Director – GJF, added: “The High Level Committee Report, which was unanimously accepted by the Government, was prepared after taking the suggestions and recommendations from more than 60 associations of India into consideration. Keeping in mind, the unique characteristics of the gems and jewellery sector, the karigars and small jewellers were kept out of purview of the Excise Duty. Therefore, while we welcome GST we request the GST Council to kindly recognise the practical issues faced by the sector as highlighted in the HLC Report before making any decisions.”

Manoj Jha, Director – GJF, said:  “The GST Council has proposed multiple GST codes for the G&J Industry, consisting of 13 major codes with over 50 sub codes. We have explained the criticality of the HSN code to the Honourable FM of Bihar and Commercial Tax Minister, wherein GJF feels that for an unorganised industry, it will be extremely difficult for over 80% of the players to adhere this compliance procedure. It will be an arduous task to maintain stock at the 8 digit level of HSN and potentially result in legal complications with the tax authorities. It is recommended that one standard HSN code to be maintained for the industry.”