2,000 traders shut shops
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Jewellery traders in the city have downed shutters for three days starting Saturday, as part of a countrywide protest seeking the complete withdrawal of the hike in the excise duty on gold imports proposed in the Union Budget.
“We are also very upset with bringing non-branded jewellery under the ambit of excise net which will see purchases above Rs 2 lakh attract 1 per cent TDS,” said N. Anantha Padmanaban of NAC Jewellers. Customs duty was hiked from 1 per cent to 2 per cent as recently as in January, Padmanaban pointed out.
The net effect of all this will be that customers will have to bear the brunt, said Princeton Jose, managing director of Prince Jewellery. This increase is likely to push gold prices by Rs 800-1,000 per sovereign (8 gm), he said.
“Gold buying is already down by about 20 per cent because of non-season and year-ending concerns. If this too is added, it will be bad news for us,” he lamented.
In Chennai alone, there are more than 2,000 shops trading in the precious metal and their total business turnover for a day is estimated to be Rs 50-60 crore.
Hence, this three-day shutdown from March 17 to March 19 is expected to have a Rs 150-180 crore effect in the Chennai market alone.
The duty hike had come into place with immediate effect and this led to excise officials making a beeline for gold jewellery shops. “Most traders were even clueless about this excise hike and it is totally unfair to tax us more in a span of two months,” complained gold traders.
Such high duties will lead to unauthorised sale of gold, cautioned Rajiv Jain, chairman of the Gem and Jewellery Export Promotion Council. “The council is not supporting the bandh call, but it is a matter or concern as most of our exporters also deal with domestic markets,” he said.
Gold is something that people recycle often and if one ends up taxing it every time it is certainly something to worry about, he said.
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