GJC Submits Pre-Budget Recommendations To Ease MSME Jewellers’ Tax Burden

New Delhi, Jan 19 (KNN) The All India Gem & Jewellery Domestic Council (GJC) has submitted pre-Budget recommendations to Finance Minister Nirmala Sitharaman ahead of the Union Budget 2026–27, seeking tax and policy measures to ease cost pressures on small and medium jewellers.

Addressing Rising Gold Prices and Structural Issues

The council highlighted that sharp increases in gold prices over the past year have amplified structural challenges for jewellers. Higher prices have raised the effective tax burden on consumers and tied up working capital, even though statutory tax rates remain unchanged.

Tourism, MSME, and Digital Measures

The council also called for immediate implementation of the Tourist GST Refund Scheme at major airports, simplified compliance for MSME jewellers, regulation of digital gold, lower merchant discount rates for card payments, and formal EMI options for hallmarked 22-karat jewellery.

Key Tax and GST Recommendations

The GJC’s tax and GST proposals focus on five key areas: rationalising GST, providing direct tax relief on inventory valuation, formalising the sector, and speeding up the rollout of existing schemes. 

They recommend reducing GST on gold and silver jewellery from 3 per cent to 1.25–1.5 per cent to ease inflationary pressures and boost demand, introducing a refund mechanism for accumulated input tax credit on services or lowering GST on services such as rent, security, and logistics (currently 18 per cent), and clarifying the 5 per cent GST rate for jewellery job-work services. 

Additionally, they propose allowing a one-year deferral of income tax on unrealised inventory gains from gold price appreciation and granting capital gains tax exemption when hallmarked jewellery is exchanged and reinvested.

Industry Perspective

GJC Chairman Rajesh Rokde said a modest GST cut, along with tax relief on inventory gains and clarity on job-work taxation, would encourage formal transactions, support artisan livelihoods, and make jewellery a more accessible savings option for households.

GJC expressed willingness to collaborate with the government to implement the measures and strengthen the sector’s contribution to the economy.

(KNN Bureau)