The Centre is likely to take a key decision on gold and silver imports. The GST Council will consider a proposal to remove the existing IGST exemption on gold, silver and platinum imported by banks and government-recognised nominated agencies. Official sources said that this is likely to be discussed in the meeting to be held on October 7.

Currently, there is a three percent IGST on gold, silver and platinum imports. However, precious metals imported by banks and government-recognised nominated agencies are exempted from this tax. This facility was introduced in 2017.

At that time, imports of precious metals were done only through certain channels. Tax exemption was given to facilitate trade. Now, as the situation has changed, it is reported that this exemption should be removed. If the decision comes into effect, there will be a level playing field for bullion exchanges and nominated agencies in terms of tax.

Gold and silver imports have become a matter of concern for the country. A huge amount of foreign exchange is being spent on these. As a result, pressure will increase on foreign exchange reserves. India is the largest consumer of gold in the world after China. The main reason for gold imports in the country is the demand from the jewellery industry.

Recently, the import duty on gold and silver was increased from six percent to 15 percent. The duty on platinum was increased from 6.4 percent to 15.4 percent. This decision was taken with the aim of reducing unnecessary imports.

Between April and August of the financial year 2026-27, gold imports increased by 3.38 percent to $ 17.47 billion. At the same time, silver imports decreased by 8.81 percent to $ 1.74 billion.

If the three percent IGST exemption on gold imported by banks and nominated agencies is abolished, its impact is likely to have an impact on domestic gold prices. If the increased tax burden on importers is partly passed on to bullion prices, retail customers may have to buy gold at a slightly higher price. However, it cannot be said that the price of gold will increase by three percent just by abolishing the exemption. Factors like international prices, rupee value, and import duty also affect the final price.