Budget 2021: Gold, silver rates to go down as FM proposes to cut customs duty

Finance Minister Nirmala Sitharaman presented her third Budget in the parliament on February 1, 2021. After the budget speech of Union Finance Minister Nirmala Sitharaman, the price of gold is likey to go down in the coming days. 

In the upcoming Budget 2021 the gem and jewellery industry had requested the Centre to reduce customs duty on gold to 4%, withdrawal of tax collected at source (TCS), cut in import duty on polished precious and semi-precious gemstones. Currently the customs duty on gold is 12.5 per cent.

Gold and silver prices will come down in the next financial year as Finance Minister Nirmala Sitharaman proposed to cut customs duty on these precious metals from 12.5% to 7.5%.

"Gold and silver presently attract a basic customs duty of 12.5%. Since the duty was raised from 10% in July 2019, prices of precious metals have risen sharply. To bring it closer to previous levels, we are rationalizing custom duty on gold and silver," the FM said.

However, the budget proposed to introduce Agriculture Infrastructure and Development cess at the rate of 2.5%, which will be applicable on gold and silver prices as well.

Customs duty on gold dore bar proposed to be reduced from 11.85% to 6.9% while on silver dore bar, the duty was cut to 6.1% from 11%. Similarly, customs duty on platinum and pallidum will come down from 12.5% to 10%.