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Hegde hints at lifting of sales tax on diamonds

Union Commerce Minister Ramakrishna Hegde today assured gem and jewellery exporters that the government would consider abolishing sales tax on diamonds.

Addressing a gathering after inaugurating the 14th India International Jewellery Show '98, Hegde said exports in the gem and jewellery sector was more or less steady when the first quarter of the year registered a negative growth in general.

''Growth of exports depends upon how competitive goods are in the world market. Indian gem and jewellery are doing very well in exports and the government is committed to encouraging it further,'' he stated.

Several measures undertaken by the Union government to boost exports have started yielding results which can be seen by the export figures of eight per cent in the month of July itself, the minister informed.

He stressed that boosting exports is a national priority and said that he would ask the prime minister to convene a meeting of chief ministers and state finance ministers to chalk out a strategy to maintain parity in taxes which would also ensure that state governments are not divested of the legitimate revenue due to them and there was no evasion of taxes.

Referring to octroi duty, Hegde said that it was an outdated method of taxation and a source of harassment and corruption. ''As the finance minister of Karnataka, I was the first to abolish octroi in 1965-66''.

He said the government would also consider various requests of exporters like exhibition grounds on lines of Pragati Maidan in large metropolises and setting up of institutes to train youth in manufacturing diamonds. He said recently he wrote to chief ministers of ten states regarding exhibition grounds and Karnataka and West Bengal had responded immediately.

''Please remind your chief minister about my letter,'' he told Maharashtra Finance Minister Mahadeorao Shivankar who was also present on the occasion. Earlier, Shivankar felt there should be parity in imposing taxes in all states. In the next state budget, the government would explore possibilities of merging octroi with sales tax. He also stated that his government would take all necessary steps to strengthen the gem and jewellery business in Maharashtra.

FIEO president Ramu Deora and Pravin Shankar Pandya of Gem and Jewellery Association said that Maharashtra government was not taking enough steps to boost gem and jewellery export which accounted to foreign exchange reserves of $ 5.6 billion.

The India International Jewellery Show, a four-day affair at the World Trade Centre is offering a unique opportunity to the exhibitors to display their creations to a wide cross-section of international and domestic wholesale buyers.

International organisations like World Gold Council, De Beers and Argyle are lending support to the event.

The council is expecting over 10,000 visitors including national and international buyers from the Middle East, the USA, Europe and southeast Asia to attend the 14th IIJS'98.

About 114 exhibitors comprising India's leading gem and jewellery exporters, renowned international jewellery manufacturers are participating and displaying their collection through 164 stalls. For the first time, there will be a separate pavilion with ten leading Italian machinery firms brought together under the umbrella of the Italian Trade Commission.

An educative flavour specially for the young will be added to the exhibition through seminars, to be conducted by reputed institutions from Bombay such as Shrimati Nathibai Damodar Thakersey Institute, National Institute of Fashion Technology, Jewellery Product Development Centre Bombay / Delhi, Gemological Institute of India and Indian Diamond Institute, Surat.

UNI