Page 11 - Bullion World Volume 3 Issue 2 February 2023

Bullion World | Volume 3 | Issue 2 | February 2023

Mr James Jose, President, Hallmarking Federation of India
The 2023 Union budget has exempted capital gain tax for converting
physical gold to EGR, which is a welcome step in encouraging the
recirculation of idle gold holdings at the commodity exchanges, thereby
reducing imports. However, without a corresponding announcement of a
hassle-free deposit of 500 gms of gold for households, the expected inflows
of old gold into EGR may not happen.

Many of the long pending demands of the gold refining industry, which are
revenue neutral, such as the permission to import gold Dore from Dore
aggregators abroad, remain unanswered. The 1% import duty disparity on
bullion under the India UAE-CEPA and the continuously prevailing price discounts of 6 -10% on bullion
coming from the grey market have practically spelt the death knell of the domestic gold refining industry.
It is disappointing that the industry demand to reduce import duties considerably so as to disincentive
unofficial supplies has not found favour with the govt.

Mr Haresh Acharya, Director, Parker Precious Metals
The government has introduced a stable budget. It has made all the
duties of precious metals equal. Also, they have increased the duty for
silver by 5%. This is a long-term plan of the government to stabilize the
precious metal market. Looking at the volatility of the market, this is a
good approach. With time we will see the market will catch up with these
changes. Continuous and uneven changes in duties have multiple effects on
the market. Some traders gain, whereas many lose. I hope if this equal duty
on all the precious metals remains for a longer period of time, it will benefit
all. In my opinion, if the incentive and duty will remain constant for a longer
time, it will result in healthy competition in the market.

Mr Shailesh Choksi, Managing Director, Choksi Heraeus
Overall, the union budget for 2023-24 is growth oriented. We commend
the government for continuing its push on manufacturing, renewables and
job creation. The increase in import duty of silver may not have any major
impact on the industrial demand for silver, as silver is usually a small fraction
of the cost in many products. The case may be different for silver jewellery
and silver articles.

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