THIRUVANANTHAPURAM: The e-way bill exemption for gold has become a boon for traders engaged in tax evasion and sale of smuggled gold. Kerala, which saw a drastic fall in the tax revenue from gold sales, had asked the GST Council to make e-way bill mandatory for the same. Finance Minister Thomas Isaac had earlier said that the tax revenue from gold sales showed a sharp decrease after the GST implementation.
According to him, the tax revenue in the end of VAT regime was Rs 627 crore a year, which fell to `220 crore under the GST. The state is a strong votary for making e-way bill mandatory for gold trade at the GST Council. “It is absolutely necessary for the state to collect the eligible tax share. Jewellers are utilising the e-way bill exemption for illegal trade worth crores of rupees,” said a taxes officer who did not want to be named.
“The exclusion also helps the traders transport smuggled gold across the country. A provision for sale by approval in the GST rules is widely misused. Under this, a consignment can be brought to a jeweller as part of sales canvassing. Using this provision, unaccounted gold can be transported hassle-free,” the officer said, and added that the wholesalers were willing to take the risk considering the huge profit.
“There were incidents in which we had seized such gold. The traders later took the gold back by paying the three percent tax and a penalty of equal amount,” he said. Curiously, the state taxes department is not taking any followup action on the unaccounted gold seized. It releases the gold when the accused pays the tax and penalty. The tax and penalty are collected as cash and a proposal to make DD or cheque payment was rejected by the department. This virtually hinders any follow-up investigation on the accused.