Budget 2024: Cheaper Gold & Silver to bring cheers to jewellery buyers

Good news for gold lovers in India. With the union government reducing import duties on gold, silver and platinum, prices of these precious metals are coming down significantly. At a time, when gold prices are hovering around all time high levels, the move will encourage buyers to purchase more jewelleries made of gold, silver and other precious metals, industry stakeholders now expect.

"We welcome the 2024 Budget's progressive measures to reduce customs duties on gold, silver, and platinum. These changes, coupled with the government's commitment to enhancing domestic value addition and craftsmanship, are poised to significantly benefit the jewellery industry, further contributing to the sector’s growth. The new tax regime, with its focus on increased disposable income will boost demand for jewellery as consumers will invest in asset creation,” says Ramesh Kalyanaraman, Executive Director, Kalyan Jewellers.

According to Amit Pratihari, Managing Director, De Beers Forevermark, the proposed reduction in customs duties to 6% on gold and silver, and 6.5% on platinum, will enhance sales by making these precious metals more affordable. “The implementation of safe harbour rates for the diamond-cutting industry, for foreign mining companies selling rough diamonds in India, will stimulate growth, boost consumer spending, and increase global competitiveness. Furthermore, the reduction of TDS from 1% to 0.1% for e-commerce operators will substantially support the industry's expansion. These new measures will not only strengthen the valued investment of Indian households in diamonds but also add to their emotional significance,” he adds.

While tabling the union budget the Finance Minister today announced reduction of basic customs duty on gold, silver and platinum to 5% from 10%. While the Agriculture Infrastructure & Development Cess (AIDC) imposed on these metals has been brought down to 0.35% to 1%, depending on the type of metal, from 4.35% to 5.4%. As result, says Abneesh Roy, Executive Director at Nuvama Institutional Securities, total duty incidence on imported gold (including GST) comes down to 9.2% from 18.5%. This “should help spur jewellery demand, ahead of festive season,” says Roy.

Kumar Rajagopalan, CEO, Retailers Association of India concurs. “The reduction of duty on gold, precious metals, and mobile phones will also provide a significant boost to these sectors, particularly during the festive season,” he adds.