Diamond processing industry gets relief with IGST exemption on imports
“An exporter with an annual turnover of ₹5 crore for each of the last three years may export cut and polished diamonds (each of 0.25 carat or more)…for testing,” said a fresh exemption list, adding that on their re-import within three months of export, these cut and polished diamonds will be exempt from customs duty as well as IGST. The decision was taken at the meeting of the GST Council on Sunday.
Similarly, the Council has also exempted from IGST import of diamonds for certification, grading and their subsequent re-export. This was also one of the key demands of the diamond industry, which had also been seeking withdrawal of the proposed 0.25 per cent GST on rough diamonds. “The exemption from IGST was a must as diamonds have to be exported for part of the certification. They are then re-imported. Paying IGST would have been a huge exercise and compliance burden,” said Praveen Shekhar Pandya, Chairman, Gem & Jewellery Export Promotion Council (GJEPC), adding that they are also hoping that transactions through the Diamond Dollar Accounts will also be nil-rated.
About 65 per cent of the global diamond processing is done in India with gross exports of cut and polished diamonds estimated at close to $23 billion. In fact, nearly 95 per cent of the diamonds after being cut and polished are exported back.
The Central Board of Excise and Customs also released the final rules and formats for accounts and records on Monday. These were approved by the GST Council in its meeting on Sunday. These require manufacturers, agents, work-contractors, transporters to maintain detailed accounts.
Courtesy: Hindu Business Line