High gold prices hit jewellery manufacturers as they pay tax for the gold stock with them
Jewellery manufacturers in Coimbatore are requesting the Indian government to revise gold stock valuation methods for tax purposes. They argue that the 65% surge in gold prices between March 2025 and 2026 has unfairly inflated their tax liabilities based on current weighted average cost calculations.
Why it matters
This highlights the impact of commodity price volatility on small-to-medium business tax burdens and the potential need for fiscal policy adjustments during inflationary periods.
Jewellery manufacturers in Coimbatore have urged the Union government to change the way gold stock valuation is calculated for them for taxing purposes, as gold prices have increased 65 % between March 2025 and March 2026. K. Muthuvenkatram, president of the Coimbatore Jewellery Manufacturers’ Association, told the media here on Tuesday that the closing stock value for the jewellery manufacturers and retailers is calculated based on weighted average cost of the gold stock available with them at the end of the financial year. With steep rise in price of gold, the value of the stock with the jewellery manufacturers and retailers has also increased.
The article reports on a specific industry grievance without taking a stance on the validity of the tax policy.
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