Govt ready to reduce customs rate on gold and silver: Finance Minister Paudel

KATHMANDU: Deputy Prime Minister and Minister for Finance Bishnu Prasad Paudel has announced the government's readiness to reduce the customs rate on gold and silver.

During a meeting on Monday with officials from the Federation of Nepal Gold and Silver Dealers' Association (FENEGOSIDA), Federation of Nepal Gold Silver Gem & Jewellery Associations (FNGSGJA), and Federation of Handicraft Associations of Nepal (FHAN), Minister Paudel acknowledged the recent reduction of customs rates in India and the necessity to address its impact on Nepal. He assured that a decision would be made soon after consulting with relevant agencies.

FENEGOSIDA President Arjun Rasaily highlighted that India's recent budget reduced the customs rate on gold and silver to 6%, while Nepal's rate remains at 20%. He proposed reducing Nepal's rate to 8% for gold and 6% for silver to prevent trade imbalances. Rasaily also suggested maintaining a flat customs rate and reviewing it every 15 days to address business challenges, as banks import gold at specific times while the customs rate changes daily.

Rasaily recommended organising the existing recommendation system and arranging the import of 50 kilograms (kg) of gold daily, with 30kg allocated for businesspersons and 20kg for the jewellery industry. He emphasised the need to balance market demand and supply throughout the year and import within the annually fixed quota according to seasonal variations.

The delegations from the three federations presented a memorandum to the Finance Minister, outlining urgent issues in the gold and silver sector. The memorandum included demands for a one-door system involving the Ministry of Industry, Commerce and Supplies, Ministry of Finance, and Nepal Rastra Bank (NRB) to handle all gold and silver-related work. It also called for assigning gold distribution responsibility to select banks and reviewing the existing 20% customs duty on raw gold imports, compared to 9.5% on jewellery items, to protect the livelihoods of smiths.

Other demands included increasing the limit of gold imported under Jhiti-Gunta, stamping the purchase bill of gold imported under Jhiti-Gunta at the customs entry point, allowing jewellery businesspersons to purchase fine gold from importers based on the same, and establishing clear guidelines for gold and silver transactions.

Present at the meeting were Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Vice President (Associate) Jyotsna Shrestha, FNGSGJA President Kishan Sunar, distinguished member Suresh Man Shrestha, FHAN President Prachanda Shakya, FNEGOSIDA Senior Vice President Diyesh Ratna Shakya, General Secretary Kiran Bhai Bajracharya, Treasurer Sudeep Shrestha, FNGSGJA First Vice President Dwarika Bisworkarma, General Secretary Nir Bahadur BK, Kathmandu Gold and Silver Dealers' Association President Rohina Shakya, and other businesspersons.