Reduce Import Duty on Gold Says Niti Aayog

  • 28-Apr-2017
  • Reduce Import Duty on Gold Says Niti Aayog

NEW DELHI: Niti Aayog, the government's think tank, has called for reducing import duty on gold to clamp down on smuggling and make the yellow metal available for small and medium firms. 

"Reduction in customs duty will not only reduce incentives for illegal transactions but it will also help ensure availability of gold for small and medium firms, thereby increasing share of gold jewellery produced by the sector," the Aayog said in its draft three-year action agenda, which will replace the five year plan. 

The recommendations are part of a wider strategy to create jobs in various labour intensive sectors. The government had re-introduced import duty on gold in 2013 to trim current account deficit. The duty is now at 10%. “Imposition of the duty has created incentive for traders to smuggle gold.At the buyer level, it has created a monetary incentive to pay for gold in cash in exchange for a cheaper price,“ said the draft action agenda. There have been demands in the past to reduce the import duty o .. 

The think-tank also backed deeper labour reforms to help entrepreneurs accelerate creation of regular salaried jobs. It identified two simple reforms which could be considered right away fixed term employment and definition of start-ups. 

"Recently fixed-term employment has been introduced in the textiles and apparel industry . This option may be extended to contract workers. The change will encourage employers to rely on regular fixed-term employment instead of contract workers, especially when hiring workers for specific projects or meeting seaso nal demand,“ the report said. “Regarding startups, any enterprise less than five years old and having less than Rs 25 crore in turnover may be permitted to declare itself a start up wi .. 

The think tank also said that unifying existing large number of labour laws into four codes without reform of the laws will serve little purpose. “Unless we bring about substantive change either by amending existing laws or rewriting them afresh, we cannot expect to change the current situation where low-productivity and low-wage jobs dominate the landscape,“ the think tank said.

Niti Aaytog has exuded confidence that India will get back to over 8% growth as it proposed a host of reforms, including reduction in corporate tax to 25% and uniform import duty at 7%. “Indeed, there are good prospects that we will return to 8% plus growth trajectory in another 2-3 years if not sooner. Therefore, the chances of massive cut in the poverty rate in the upcoming decade are excellent, .. 

Source: Economictimes.indiatimes.com

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