Although gems and jewellery worth US$477 million were exported in 2023, exports have fallen by 25% to US$360 million last year (2024) after the imposition of taxes on the gem and jewellery industry, says Chairman of the National Gem and Jewellery Authority (NGJA) – Mr. Navin Sooriyarachchi.
He stated this at a media briefing held at the Government Information Department yesterday (July 07).
This media briefing was held to inform the media about the newly opened VAT Refund Counter at the Bandaranaike International Airport in Katunayake.
He said that following discussions with the International Monetary Fund (IMF), taxes were imposed on their industry from January 01, 2024.
Accordingly, an 18% VAT was imposed when selling gems and jewelry to tourists as well as when importing rough gemstones. In addition, a 45.14% tax was imposed on gold imports, he added.
Noting that the NGJA has issued about 8,000 mining licenses, he said that these should produce gemstones worth over US$ 1.5 billion annually, assuming that around 50% of these mines were profitable.
He added that Gem and Jewellery had the potential to be the second largest primary export of the country.
However, following the imposition of the 18% VAT, sales have declined significantly, Mr. Sooriyarachchi says, adding that competitive practices such as post purchase VAT refunding followed by other countries have further affected this situation.
