New Delhi has removed a longstanding waiver that had spared certain bullion shipments from paying IGST, and those imports will now face a 3% levy. First rolled out for gold in 2017 and later expanded to silver and platinum, the relief was meant to smooth the movement of metal through sanctioned traders. Ending the waiver lifts costs for the main channels that supply one of the biggest bullion markets globally and aligns taxes across different import routes for gold and silver.
Shrivastava told reporters the government did not continue the exemption past March 31 and put the measure in place on April 1 so that "we do not have tax becoming a reason for one route being preferential to another." He also said the GST council was briefed on the change at its meeting on Thursday.
Import duties on gold reshape demand in the world's biggest market for it. Market Briefs covers commodities free every morning.
Some importers had already been paying the tax in recent months after a broader slate of exemptions lapsed. On April 17, the DGFT released an updated roster of eligible importers, but the IGST exemption notification itself was not updated. India strictly limits who can ship in gold: most cargoes arrive via approved banks and nominated agencies, with qualified jewelers also able to bring in metal through the India International Bullion Exchange. The new levy will lock up more working capital for these players.
Bottom line: importing metal through the main channels now costs more, and importers will have more cash tied up as a result. If you follow gold for jewelry buys or as a hedge, keep an eye on how these higher carrying costs show up across the market over time.
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