Panaji, April 4 (IANS) Finance Minister Pranab Mukherjee’s move to tax gold has come in for criticism from Goa’s Congress MP Shantaram Naik, who has said that a tax on gold in India amounted to a “tax on culture”.
Naik, also a member of the finance ministry’s consultative committee, has written to Mukherjee seeking a rollback of the excise duty (1 percent on non branded jewellery) and drop the controversial move to make production of a PAN card mandatory while purchasing gold worth Rs.2 lakh.
“The entire proposal in the budget proposals with respect to gold has to be examined as a micro economic issue and not merely as a macro issue,” Naik has said in his letter.
“Indian marriages are a part of Indian culture and no marriage can take place without gold ornaments being exchanged as a part of custom and tradition. The new tax proposals should not be construed as an impediment to marriages in India,” the letter said.
Jewellery was a part of India’s cultural DNA, Naik added.
In the budget presented by Mukherjee last month, the basic customs duty on standard gold bars has been doubled to four percent and the one percent excise duty on branded jewellery has been extended to unbranded jewellery as well.
“With the taxation as well as the customs duty on gold — which is in turn converted into ornaments – amounts to triple taxation when you add the local government’s VAT,” Naik told IANS.
“There are thousands of petty Goan jewellers for whom this new tax and duty regime will be difficult to comply. The gold and diamond traders in Goa are on the verge of going out of trade,” Naik said.