The government’s decision to lower the basic customs duty on gold bars from 15% to 6% and reduce the Agriculture Infrastructure and Development Cess (AIDC) on the duty from 5% to 1% has contributed to this price adjustment. With the application of a 3% GST rate, the effective taxes on gold have now decreased to 9% from the previous 18.5%. Similarly, the effective tax rate on silver bars has also been reduced to 9%. As a result, gold prices have seen a drop of Rs 6,192 per 10 grams and silver prices by Rs 7,686 per kilogram.

Ajay Kedia, managing director of Kedia Commodities, mentioned that the industry’s persistent request to lower duties is expected to curb the increase in gold smuggling activities.

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