Sale of old jewellery will attract 3 per cent GST: Hasmukh Adhia

The revenue secretary explained further that purchase of old jewellery by a jeweller will be chargeable at 3 per cent GST under the reverse charge mechanism. So, if old jewellery worth Rs 1 lakh is sold, 3 per cent GST or Rs 3,000 will be levied on the transaction.

By: ENS Economic Bureau | New Delhi | Published:July 13, 2017 2:14 am
Hasmukh Adhia, Sale of old jewellery, GST, gold GST, Gold jewellery GST, indian express news, india news, economy Revenue Secretary Hasmukh Adhia. PTI photo

Sale of old gold jewellery for purchase of new jewellery/bullion from the sale proceeds will be eligible for input tax credit under the Goods and Services Tax (GST) regime, Revenue Secretary Hasmukh Adhia said.

“Supposing I am a jeweller. Somebody comes to me with old jewellery, it is as good as buying gold. You can later claim input tax credit,” Adhia said at the GST Master Class. The revenue secretary explained further that purchase of old jewellery by a jeweller will be chargeable at 3 per cent GST under the reverse charge mechanism. So, if old jewellery worth Rs 1 lakh is sold, 3 per cent GST or Rs 3,000 will be levied on the transaction. If the proceeds from the old jewellery is used for buying new jewellery, the tax paid on sale will be adjusted against GST on purchase, he said.

However, if an old jewellery is given to the jeweller for some modification, then it would be considered as job works and 5 per cent GST would be levied. “But if I’m saying that take my old jewellery melt it and give me a new one, then it means that trader is a registered person and it is as good as buying gold in form of old jewellery,” he said.

Under the GST regime effective from July 1, gold is taxed at 3 per cent, while job work for jewellery attracts 5 per cent levy.
On the taxation on download of movies and television shows on Netflix, he said the US company is paying service tax, which will now be replaced by GST. For advertisements on website or blogs, Adhia said if the money is earned by way of providing services then GST would be levied.

The Revenue Secretary and other tax officials added that the ministry will soon issue the necessary clarification regarding the various provisions related to advertisements on websites after seeing representations from the stakeholders.

Giving details on the composition scheme, under which traders, manufacturers and restaurants can pay a flat rate of 1, 2 and 5 per cent, respectively, Adhia said that businesses and traders willing to avail the composition scheme will have to choose the option by logging into the GSTN portal by July 21. New registrants will have the choice to opt for the composition scheme at the time of filing forms for registration.

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