Despite the ongoing jewellers' strike to protest against reimposition of 1 per cent excise duty on gold and diamond jewellery, CBEC today said the sector contributes to generation of black money and needs to be brought under the tax ambit.
"We have brought jewellery (sector) into the tax net. This is the levy which we had attempted two years ago and withdrawn... This is the sector which you will agree with me needs to be brought into tax needs," Chairman of the Central Board of Excise and Customs (CBEC), Najib Shah today said at an event organised by industry body Assocham. "This is a sector which lends itself to generation of unaccounted wealth."
The CBEC chairman said the revenue department will take a hit of Rs 1,000 crore due to the change in CENVAT credit rules. "But we thought it is essential because the cost of litigation for you and me are much more than revenue which otherwise we have got," he said. Noting that the government has increased some duties, Shah said it's done so to create a level-playing field for Indian industries as was the case in defence. He urged industries to stop demanding exemptions to avail of goods and services tax (GST). "If you want GST, you should not demand exemptions because two don't go together," Shah said.