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Gold prices: 24 carat gold rises by ₹1,450 since import duty hike

Gold prices on Sunday stayed steady across the country. However, the start of this month has resulted in gold prices getting costlier all thanks to the import duty hike. The price of 24 carat in 10 gram has increased by at least 1,450 in three days. While the price of 22 carat gold has jumped by 1,350.

Today, 10 gram gold in 22 carat is available at 48,000 and 24 carat is priced at 52,340.

These rates do not include GST, tax collected at source, and other levies.

In major cities, 24 carat gold in 10 gram is most expensive in Ahmedabad and Surat at 52,500. While cities like Mumbai, Delhi, Kolkata, Hyderabad, Kerala, Vijaywada, Bhubaneswar, and Visakhapatnam are selling gold at 52,340 in the same carat.

Gold in 24 carat is priced at 52,390 in cities like Pune, Vadodara, Patna, and Nashik. In cities like Mysore, Mangalore, and Bangalore – gold is available at 52,420. Jaipur, Lucknow, and Chandigarh sold gold at 52,490. Meanwhile, the yellow metal was available at 52,280 in cities like Chennai and Coimbatore.

According to Good Returns data, 24 carat gold was at 50,890 on June 30 and the 22 carat in 10 gram was available at 46,650.

However, on July 1, Finance Ministry increased gold import duty to 12.5% from 7.5% – resulting in a hike of 5%. Notably, it is expected that the total levies on gold could likely be around 18.45%.

Sugandha Sachdeva, VP- Commodity & Currency Research, Religare Broking explains that in an attempt to stem the steep decline in the rupee and curb the widening trade deficit, which has soared to record highs of $23.33 bln in May amid rising import bills, the government has raised the import duty on gold by 5% in a surprise move, which makes the import duty on gold as 12.50%, while the effective duty on gold will be 15%, including the 2.5% Agri Cess, as social welfare surcharge of 0.75% has been exempted. In all, the net duty change will be 4.25%. Gold also attracts an additional 3% GST as well, which means the total levies on gold will be 18.45%.

The hike in gold import duty was needed as there has been a significant jump in imports which is putting pressure on the current account deficit.

In May, gold imports stood at 107 tonnes of gold compared to 11 tonnes same period last year and in June also the imports have been noteworthy.

As per the data, Gold jumped by 1,310 on July 1st in 24 carat and by 1,200 in 22 carat on the same day. Further, the gold climbed by 140 in 24 carat on July 2nd and by 150 in 22 carat.

Since gold prices have remained unchanged today. So far in three days of July, 24 carat gold has increased by 1,450 and 22 carat gold price has soared by 1,350.

Gold prices are expected to rise further ahead following the import duty hike.

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