One of the most burning topics for consideration these days is the strike of jewelers against the government over 1 percent excise duty levied on them. Recently, the government of India has introduced 1 percent excise duty in its budget on this industry. Being a distinctive form of indirect t taxation, the government has applied this regulation to prevent any kind of illegal import, tax evasion or selling the jewellery in black.
It is undoubtedly an excellent approach by the government to stop the crime relating to jewellery. In fact, the jewelers have the full-fledged independence of collecting this 1 percent tax for their customers. So what is the major reason for their strike? This question has become a robust topic for debate amongst individuals.
Here are some of the possible factors that might certainly be the reason for this stretched strike. They include
One of the major factors can be the illegal import activities in which almost every big jeweler is involved. Not all the gold that they import comes from proper channel. They import certain amount of gold in black to avoid 10 percent import duty. However, while selling with 1 percent excise duty, the chances are that customs will get to know of their illegal import. Not only this, they will also be exempted from tax evasion that they save from illegal imports.
Black jewellery selling
With the implication of excise duty, the jewelers will not be able to sell their jewellery in black that can simultaneously affect their profits. The jewellery sold to high-earning customers like government officers, lawyers, doctors, politicians and large farmers is mostly done in black. This is not at all possible with excise duty implication.
Cheating the customers
Another possible reason for jewelers to be on strike may be that they will not be able to easily cheat their customers as they usually tend to do in charging for the wastage while converting the gold into jewellery.