NEW DELHI – Jewelers in India may go on strike, unless the government drops newly proposed measures which would effectively prohibit rural farmers from buying gold because they do not have a tax number.
Earlier this week All India Gem and Jewellery Trade Federation warned that gold sellers in the country may stage a strike if the government doesn’t drop the current proposal to require consumers to present their tax number when purchasing jewellery.
In late February the government proposed that in order to help fight the use of illicit funds in the country, any purchase of gold jewellery worth more than INR 100 000 should require the purchaser to present their Permanent Account Number, ultimately helping tax authorities to track if any individuals’ jewellery purchases are in line with their declared incomes.
According to the All India Gem and Jewellery Trade Federation warned that the new requirement will impact as much as 60 percent of all jewellery sales, especially in rural areas, where many purchasers do not have a Permanent Account Number.
It was noted that the lack of a Permanent Account Number is not a sign that an individual has illicit funds, a a significant portion of individuals in India are not required to file for taxes and have not applied for the number, including almost all farmers, as farming profits are exempt from income tax.
Photo By: Priyambada Nath