The gem and jewellery industry has once again urged the government to reduce the import duty on gold from 15% to 5% in order to cushion the impact of soaring global gold prices.
Local gold prices have reached unprecedented levels in line with international trends, while supply disruptions have left small jewellers struggling to survive.
“We have given several proposals to the Finance Ministry. They are responding to them, but no follow-up action or decision has been taken so far,” said Rizwan Naeem, President of the Sri Lanka Gem and Jewellery Traders Association.
The 15% tax was introduced in April 2018 to curb rising gold imports and discourage gold smuggling, particularly to India. However, industry representatives say the measure has failed to curb illegal movement while hurting legitimate businesses.
Global gold prices have surged due to large-scale corporate buying, pushing rates to record highs. Industry sources say the domestic impact has been further amplified by policy missteps, making gold far more expensive in Sri Lanka than in international markets.
“Our proposal is to reduce the duty from 15% to 5% so that the government can generate more revenue from larger volumes,” Rizwan explained. “This will allow Sri Lankans to invest in gold, which will benefit both the people and the economy in the long run.”
He warned that if the issue remains unaddressed, the industry risks collapse, leaving consumers unable to purchase gold at competitive prices.
With the wedding season underway, demand for gold jewellery remains strong, but high prices have restricted actual sales.
“Sri Lankans want to buy as much gold jewellery as possible. The only obstacle now is the unaffordable price,” Rizwan said.
