Govt got Rs 10,000 cr in under 3 months from gold duty hike, Pg15

Key Highlights:

• The Central government collected ₹10,040 crore as revenue from gold imports between May 13 and August 2.
• The total revenue from imports of gold, silver, and platinum during this period amounted to ₹10,463 crore.
• The revenue surge followed a hike in customs duty on precious metals implemented on May 13.
• The effective import duty on gold and silver was raised from 6% to 15%.
• Pankaj Chaudhary, Minister of State for Finance, informed the Parliament about these figures.

Detailed Insights:

• The duty hike on May 13 increased the Basic Customs Duty on gold and silver from 5% to 10%, and the Agriculture Infrastructure and Development Cess (AIDC) from 1% to 5%.
• The government's decision to raise import duties was primarily aimed at discouraging non-essential imports and managing the country's foreign exchange reserves and current account deficit.
• India is a major global consumer of gold, and its imports significantly impact the nation's foreign exchange outflows.
• The effective import duty on platinum was also increased from 6.4% to 15.4%.
• In addition to customs duties and AIDC, a 3% Integrated Goods and Services Tax (IGST) is applicable on all precious metal imports.
• The move is anticipated to lead to higher domestic gold prices and could potentially increase instances of gold smuggling.
• In January 2026, investments by Indians in gold Exchange Traded Funds (ETFs) surpassed those in equity mutual funds, highlighting a growing trend in gold as an investment avenue.

Key Concepts Involved:

• Customs Duty: A tax levied by the government on goods imported into or exported out of a country, serving as a revenue source and trade regulator.
• Agriculture Infrastructure and Development Cess (AIDC): A special-purpose levy introduced in Union Budget 2021-22 to fund agricultural infrastructure and development projects.
• Integrated Goods and Services Tax (IGST): A tax levied on inter-state supply of goods and services, including imports, under India's Goods and Services Tax (GST) regime.