MUMBAI: Even as consumers will face a slightly higher tax rate in gold after the Goods and Services Tax (GST) is rolled out this July, the overall impact on the gold industry will be positive, World Gold Council (WGC) said on Thursday.
“On 1st July, India’s labyrinth of taxes will be replaced with a simple, nationwide GST. This is the biggest fiscal reform since India’s liberalisation in the early 1990s,” WGC said in a report here.
“While gold consumers will face a slightly higher tax rate and the industry will go through a period of adjustment, we see the net impact on the gold industry as being positive,” it added.
WGC said the gold supply chain will become more transparent and efficient and the tax reform could boost economic growth, which is likely to support gold demand. The country’s gold market is becoming more organised and transparent, and it is likely that GST will accelerate this process, which will be good for consumers, it said.
“They can have more faith in the gold products they are buying, and this in turn can support gold demand in the years to come,” added WGC.