Gold, silver and platinum imports could see a tax change as the GST Council considers ending the IGST exemption for select banks and nominated agencies. Here’s what may change
The proposed withdrawal of the exemption is aimed at creating a level playing field in the precious metals trade and tax system. The government has gradually tightened the rules around such exemptions in recent years. If the IGST exemption is removed, banks and nominated agencies would be brought on par with regular bullion exchanges in terms of tax payments, potentially making the tax system more uniform and transparent.Gold and silver imports have long been a major economic concern for India because the country spends large amounts of foreign currency to buy these precious metals from overseas. This puts pressure on the country’s forex reserves. India is also the world’s second-largest consumer of gold after China, with strong demand from the traditional jewellery industry driving large annual imports.To curb rising precious metal imports and discourage non-essential purchases, the government has already taken several measures. In May, it sharply raised import duties on gold, silver and platinum. The duty on gold and silver was increased from 6% to 15%, while the duty on platinum was raised from 6.4% to 15.4%.Global geopolitical tensions are adding to the pressure on India’s economy. The conflict involving Iran, the US and Israel has increased uncertainty in international markets, raising India’s import bill and putting pressure on the rupee. Against this backdrop, Prime Minister Narendra Modi has also urged people to avoid unnecessary gold purchases to help protect the country’s economic interests.Government data shows that India’s gold imports rose 3.38% between April and August of the current financial year (2026-27), reaching about $17.47 billion. Silver imports, meanwhile, fell 8.81% during the same period to $1.74 billion. The figures show that demand for gold remains strong despite economic pressures and measures aimed at curbing imports.
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India could soon see a major change in the way gold, silver and platinum imports are taxed. The GST Council, comprising Union and state finance ministers, is scheduled to meet on October 7. The council is expected to consider a proposal to withdraw the existing IGST exemption on precious metal imports by banks and government-approved nominated agencies.
