Budget 2026: Jewellery industry seeks GST cuts, customs reform and export support
Ahead of the Union Budget 2026–27, India’s gems and jewellery industry has urged the government to consider GST rationalisation, customs-duty changes and faster, tech-enabled clearances to help exporters remain competitive amid shifting global supply chains. Industry bodies also flagged concerns about existing tax mechanisms and called for reforms tied to investment and skills.
A pre-Budget push from a major export sector
India’s gems and jewellery industry is pressing the Centre for a package of tax and process reforms in the Union Budget 2026–27, arguing that global trade disruptions and changing demand patterns require faster, lower-cost exporting conditions. In a pre-Budget memorandum to Finance Minister Nirmala Sitharaman, the Gem and Jewellery Export Promotion Council (GJEPC) outlined proposals spanning GST rationalisation, customs changes and policy tweaks aimed at keeping India competitive in the global diamond and jewellery value chain.
Industry leaders said the international market is in flux — with shifting supply chains and new cost pressures — and insisted that domestic rules must evolve to protect India’s edge in value discovery, processing and exports. The pitch positioned the sector as capable of driving the next round of export growth if reforms reduce friction and uncertainty.
What the industry is asking for
Among the demands: rationalising import duties on cut and polished diamonds and coloured gemstones, and aligning customs procedures with the pace of an export-heavy industry. The proposals also include risk-based customs clearances, AI-backed digital appraisal systems and self-certification for trusted exporters — all intended to shorten turnaround times and limit procedural delays.
The report also notes concerns about an existing 4% safe-harbour tax framework, with the GJEPC arguing it remains high and can discourage international trade. Separately, the All India Gem and Jewellery Domestic Council (GJC) urged GST cuts on gold and silver jewellery — calling for a lower rate — and suggested direct-tax adjustments to ease household stress and broaden the base of formal transactions.
Why these changes matter to consumers and exporters
For exporters, faster customs and clearer tax rules can mean fewer missed shipment windows and lower compliance overheads — critical in a sector where timing and price swings matter. For domestic buyers, GST and related rule changes can influence retail pricing and purchasing behaviour, especially during wedding and festive seasons when demand spikes.
The industry’s bet is that a mix of lower transactional friction and targeted tax rationalisation would help India defend market share and potentially expand into new buyer segments even as the global jewellery trade recalibrates.