Government hiked import duty on gold to 6 percent

New Delhi: The government on Monday hiked the import duty on gold and platinum to 6 percent from 4 percent with immediate effect. Government said that it is  a move aimed at curbing imports of the precious metals to check the widening current account deficit.

“The changes proposed to the Gold deposit scheme will make it attractive for individuals to deposit their idle gold with the banks under the Gold deposit scheme,” Department of Economic Affairs Secretary Arvind Mayaram told reporters.

He said the changes would help moderate import of gold and help in bridging the current account deficit (CAD).

Mayaram further said that the government will effect consequential changes in the additional customs duty and excise duty on gold dore bars, gold ores and refined gold.
He said the minimum quantity of gold that may be deposited into the Gold deposit scheme would be reduced and the minimum tenure would be brought down to six months, from the present three years.

Market regulator Sebi and the Reserve Bank will come out with notifications on Gold ETF and gold deposit schemes in two to three weeks.

Gold ETF is provided by Mutual Funds (MF), in which the units are backed by physical gold held by the MFs. Gold deposit schemes are offered by a number of banks, in which gold deposited by client is lent by the banks to the gems and jewellery trade.