Jewellery to get cheaper as customs duty reduced on jewellery and parts: Budget 2025
The Finance Minister has reduced the customs tariff for item code- 7113which is articles of Jewellery and parts
thereof. The old customs tariff on jewellery and parts thereof was 25% and now in Budget it is reduced to 20% with effect from February 2, 2025. The customs tariff on Platinum Findings has been reduced to 5% from earlier 25%.
What is HSN code 7113?
According to Zahir Tapia, Associate, ALMT Legal, HSN 7113 denotes Articles of jewellery and parts thereof, of precious metal or of metal clad with precious metal - of Precious Metal Whether or Not Plated or Clad with Precious Metal. HSN code 7113 further covers:
Tapia says, "Reduction in customs tariff rate for item code 7113 shall result in cheaper jewellery for consumers in India, thereby increasing the demand for the same in domestic market. Further, such a reduction is expected to make jewellery more affordable and accessible to the consumers in India, driving demand in the luxury segment. Since platinum findings (components used in jewellery making), now have a significantly lower tariff of 5% (from 25%), platinum-based jewellery could become more cost-competitive compared to gold. However, the final retail price of jewellery is influenced by imported gold prices, making charges, GST (currently 3%), and retail margins, so the cost reduction may not be fully passed on to consumers."
Sweta Upadhyay, Senior Associate, ALMT Legal says, "India is known for its a jewellery market, and tariff cuts are beneficial for both consumers and businesses in the industry. The recent customs tariff cuts for jewellery, particularly on platinum findings, seems to bring a positive development. These reductions make platinum more accessible, more attractive due to the higher duty cut, potentially boosting platinum jewellery production and consumption. As a result, manufacturers may focus more on innovative, luxury designs, expanding the range of options for consumers. Lower tariffs on precious metals will help make jewellery more affordable, encourage competitive pricing, and drive a stronger focus on premium offerings, thereby benefiting both the market and industry professionals. A DGFT notification is expected to clarify restrictions on platinum alloys, ensuring that importers of pure platinum face no challenges under the licensing regime, preventing potential export procurement issues."
Colin Shah, MD, Kama Jewelry, “The reduction of Jewellery
duty from 25% to 20% is a welcome move. For a country like India who is
known for its high jewellery consumption, this will definitely boost the demand
in the domestic market specially in luxury. Similarly, slashing of duty on
platinum finding from 25% to 5% is yet another bold move which will prove
beneficial for the entire gems and jewellery industry.
Suvankar Sen, (MD & CEO, Senco Gold & Diamonds), says, “The budget has set the right objective of driving growth of India by focussing on middle class consumption, agricultural sector that will drive rural demand and rural productivity , focusing on women and youth, that will drive future growth of India . Gold and Silver duty has remained the same, thus that will avoid additional burden on Indian Consumer . Tech development is need of the hour and should be focused, to becoming a more futuristic country . I think the intent is well planned”.
Source: https://economictimes.indiatimes.com/