In the Union Budget 2016, basic excise duty of 1% is being imposed on Articles of jewellery (excluding silver jewellery). This will have major impact on individuals as well as Goldsmiths. The excise duty is levied with effect from March 1, 2016. Now, Ministry of Finance issues clarifications to remove doubts and uncertainty on such levy. The Key clarifications are given here under:
1) Articles of silver jewellery are exempt from excise duty.
2) Job workers (manufacturing jewellery for principal manufacturers) are not required to take excise registration and pay excise duty.
3) SSI exemption limit of Rs 6 crore is available to manufacturers of jewellery along with higher eligibility limit of Rs. 12 crore.
4) Small jewellers whose turnover were less than Rs. 12 crores in preceding financial year would be eligible for exemption of up to Rs. 50 lacs for the month of March, 2016.
5) A certificate of Chartered Accountant is required to determine eligibility for SSI exemption for the month of March, 2016 and F.Y. 2016-17.
6) Excise Officers have been directed to grant hassle free registration within 2 working days. Further, they are not required to visit the premises of manufacturers of jewellery. Moreover, excise duty is to be paid on monthly basis and not on each clearance. First installment of duty payment for March, 2016 is to be paid by March 31, 2016.