GST rate of 3% for selling old jewellery: Hasmukh Adhia
New Delhi: Selling old jewellery or bullion will attract a 3% goods and services tax (GST) on the value realised, revenue secretary Hasmukh Adhia said on Wednesday. But, if the jewellery is sold and new one bought through the proceeds, the 3% tax paid will be deducted from the GST payable on buying new jewellery.
“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,” he said at the GST master class.
Explaining further, Adhia said a jeweller buying old jewellery from someone will charge 3% GST under reverse charge. So, if old jewellery worth Rs1 lakh is sold, a GST of Rs3,000 will be deducted. If the proceeds from the old jewellery is used for buying new jewellery, the tax paid on sale will be adjusted against GST on the 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% GST would be levied. “But, if I am 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 rolled out from 1 July, tax is levied at 3% on gold, while any form of job work attract 5% levy.
When asked about the tax to be levied on downloading of movies and television shows on Netflix, he said the US company is paying service tax, which will now be replaced by GST. On advertisements given in website or blogs, Adhia said if the money is earned by way of providing services then GST would be levied.
However, the ministry would soon clarify various provisions related to advertisements on websites after seeing stakeholder representation. Adhia further said businesses and traders willing to avail the composition scheme will have to choose the option by logging into the GSTN portal by 21 July.
Whereas, for new registrations, they have to give their own choice at the time of filing up forms for registration. Besides, as per the rules, account records for GST will have to be preserved for six years. However, if any case is locked up in litigation, then the records have to be preserved till the litigation gets over.
Small businesses with a turnover of up to Rs75 lakh can opt for composition scheme in which traders, manufacturers and restaurants can pay tax at 1%, 2% and 5%, respectively. Businesses opting for the composition scheme will see a lesser compliance burden as they will have to file returns only once in a quarter as against monthly returns to be filed by other businesses.
- Listen hard, Mark Zuckerberg. Google’s turned up the audio in India
- L&T CFO R Shankar Raman: Don’t see private sector coming back for the next couple of years
- MakeMyTrip CEO Rajesh Magow rejoins Flipkart board after 2 years
- Opening bell: Asian markets open mixed; Tata Sons in news
- Indian economy in a tailspin: What went wrong