Gold loses its lustre in Amritsar due to VAT rules

Written by:
Subscribe to Oneindia News

Amritsar, Feb 22 : Punjab has traditionally been a paradise for those who love traditional jewellery, gold, platinum and silver items studded with precious stones.

But, from the look of things this won't last long as the government has imposed restrictions on the trade in gold. Traditional gold ornaments encrusted with precious stones are the pride of Amritsar.

Called the "Gold Home Market of India," Amritsar offers something for everyone, including pre-teens and trendy twenties' women and of course the ladies in their forties and above.

Jewellers of Amritsar don't just cater to the female clientele. There is a men's section too; there is a wide range of rings, wrist chains, bracelets and neck chains.

Crafted by local goldsmiths, hundreds of jewellery designs are available with designs and motifs carved on them. The USP, however, are the alterations done over the years.

"They have good designs, a good collection, excellent variety and an economic range also. At a higher prize range, they also have good variety and quality. There have Hall Mark gold too," said Garima Khanna, a customer.

Jyoti, another customer, added, "The jewellery here is unique in design and finish and the rates are reasonable."

The Walled City's Guru Bazaar and Katra Mohan Singh are the bullion hub.

But, over 10,000 families who have been traditionally engaged in manufacturing gold jewellery now face a major setback.

With the imposition of Value added Tax (VAT), gold traders have to compulsorily declare all gold being brought in or taken out of the state at that the 32 Information Collection Centres.

The suppliers, however, are now shifting towards the other manufacturing hubs.

"If the Punjab Government doesn't amend this regulation on compulsory declaration of bullion passing in an out of the city, many of the traders will shift to Delhi. Punjab will no longer be a bullion hub," said Pal Singh Puji, the President, Amritsar Jewelers Association.

"With the implementation of VAT, the jewelry business has come to a virtual standstill. Traders aren't coming to Punjab and we're not willing to go out. We are aware that if we go out for trading we won't survive. In other states, the goldsmiths are paying VAT on sales. But, here we are paying value based tax," said Vijay Kapoor, a goldsmith.

Bullion worth 300 million US dollars was traded in Punjab in 2007, which indicates gold worth 800,000 US dollars was sold daily.

But, with the new regulations and the all-time high gold prices, the sales have hit hard. By Ravinder Singh Robin

Please Wait while comments are loading...