MUMBAI: They can work intricate designs in gold but a digital signature--mandatory for
GST compliance--is beyond the capabilities of Mumbai's many goldsmiths. In south Mumbai's Zaveri Bazaar, which handled 65% of the country's gold trade till a decade ago, the chief concern now is to make the artisans GST-compliant.
"These workers are highly skilled but most are barely literate.For them, raising a bill and making it GST-compliant will be a huge challenge," said Nitin Khandelwal, president, All India Gems & Jewellery Trade Federation (GJF).
The gems, jewellery and diamond (GJD) industry is largely unorganised. Artisans take work from retailers and wholesalers, some of whom like Tribhovandas Bhimji Zaveri and Dwarkadas Chandumal Jewellers are big brands. The large retailers and manufacturers have so far handled all compliances, at all levels, said Ashok Minawala, director, Danabhai Jewellers.
At present, central excise duty and other levies apply beyond a turnover of Rs 10 crore. Under GST, turnover of Rs 20 lakh-Rs 75 lakh will be under the composite list while beyond Rs 75 lakh it will be under the complete tax net.
The industry wants the government to clarify the definitions of various works and positions of each entity -artisanretailerwholesaler--in the jewellery value chain so that their respective GST liabilities are known. "This is important because under the current tax regime a business transaction is categorised as a sale or a purchase while under the new regime it would be about supply of goods," Khandelwal said.
In the gold and jewellery business clients often barter gold, silver and gems, and pay the making charges with a part of their gold. How tax will be computed on these transactions is also not clear.
Secrecy is another concern peculiar to the industry . E-way bills are mandatory under GST for goods worth more than Rs 50,000, but since these disclose the value of goods, vehicle number, time of departure, etc, the safety of goods and couriers could be compromised, said Vasant Birawat, a Zaveri Bazaar veteran.
Still, Mumbai's jewellers are looking forward to GST because it will erase Gujarat's tax advantage that lured many jewellers to Ahmedabad in the past decade.When octroi and local body taxes are abolished, the playing field will be level again, said Lalit R Jagawat, director, Nakoda Bullion, one of the leading bullion traders in India
Source: timesofindia.indiatimes.com