The government has recalled the budget decision to collect 1% tax at source on gold purchases above Rs 2 lakh, amidst a steep decline in the demand for gold in the country, reports Economic Times.
The government had increased the threshold of the excise duty on the purchase of gold above Rs 5 lakh during the 2016 Budget Session, applicable from 1 June.
The move came after the country saw widespread strikes by jewellers against the 1% excise duty. The demand for gold has seen a drop of over 40%, and an increase in gold prices.
The roll back will be a major relief for jewellers and for those wishing to buy gold and jewellery in bulk.