GST expected to have positive impact on gold industry, says World Gold Council

MUMBAI: The impact of Goods and Services Tax (GST) on consumers is expected to result in slightly higher tax rate in gold, the World Gold Council estimates that post the GST being rolled out this July, the overall impact on the gold industry will be positive. Media reports quoted a report by the WGC as saying, "On 1st July, India's labyrinth of taxes will be replaced with a simple, nationwide GST. This is the biggest fiscal reform since India's liberalization in the early 1990s."

"While gold consumers will face a slightly higher tax rate and the industry will go through a period of adjustment, we see the net impact on the gold industry as being positive," the WGC report added.

The gold supply chain will become more transparent and efficient and the tax reform could boost economic growth, which is likely to support gold demand, according to the WGC report.

The country's gold market is becoming more organised and transparent, and it is likely that GST will accelerate this process, which will be good for consumers.

"They can have more faith in the gold products they are buying, and this in turn can support gold demand in the years to come," the WGC report said.

Industry also has reacted positively to the 3 per cent GST rate, it said adding there were fears that it could have been higher - perhaps 5 per cent or more.


NEWS BUREAU- 6/9/2017 1:54:37 AM