Import duty up: Gold, silver jewels get dearer

New Delhi: Gold and silver jewellery are all set to cost more with the government increasing the import duty on precious metals from Tuesday. 

    The customs duty on gold has been fixed at 2% instead of Rs 300 per 10 gram. Silver will attract 6% duty, instead of a specific duty of Rs 1,500 a kg earlier. Based on Tuesday's price, this will translate into customs duty of Rs 550/10 gram and Rs 3,163 for silver. What's 
more, the levy will rise if prices of the metals go up. The import duty structure for platinum has also been changed. 
    Branded jewellery makers say they will be forced to hike prices by 1% to 3%. While a minor raise is unlikely to result in the postponement of purchase decisions, it will help the government generate around Rs 600 crore additional revenue at a time when it is grappling with a tight fiscal condition. Continued uncertainty in the global economy and poor stock market returns are prompting people to bet on gold which is seen to be a safe haven in tough times. 
Heavy Metals 

• Customs duty on gold fixed at 2% from the earlier 300/10gm 

• Silver to attract 6% duty against 1,500/kg, duty on platinum too revised 

• The hike will make branded jewellery costlier by 1-3% 

• Government will add about 600cr to its kitty with people betting big on gold'Gold duty hike will have minimal impact' 
New Delhi: Jewellery makers say the hike in import duty of gold may not deter people from buying the yellow metal. The rising demand for gold is one of the main reasons for its price crossing the Rs 29,000 per 10 gram mark recently although it has retreated since then. On Tuesday, gold closed at Rs 27,925/10 gram in Delhi. 
    "The higher cost will be passed on to the end-consumer. It will not affect the profitability of retailers," Gitanjali Export CEO Sanjeev Agarwal said. Orra CEO Vijay Jain said, "Gold prices have doubled in the last three years, but the demand is reasonable. The impact of an increase in customs duty will be minimal and in the short term." "We saw good demand for gold until last October. But November and December have been a little weak," said MMTC director (marketing) Ved Prakash. 
    The impact on silver is, however, expected to be more pronounced. "The dynamics are a little different. But there will be no impact on investment demand," said Gnansekar Thiagrajan, director at advisory firm Commtrendz Research.