Kozhikode: Since the Goods and Services Tax (GST) will come into effect throughout the country shortly, it will be better to include the amendment on gold duty in it, said the All Kerala Gold and Silver Merchants Association….
The association’s general secretary, M. Rammohan Kamat, pointed out that the real tax issue in gold business was the compounding system. What M.P. Ahammed says in his article on this subject is also true. But the people who welcomed the compounding system when it was introduced nine years ago are now turning away from it only because turnover has not increased in proportion with compounding. Tax evasion is certainly an obstacle to the country’s progress. But goods smuggled into the country without paying direct or indirect taxes too will also block the country’s progress.
When it is said that 5,000 tonnes of gold reaches India a year and only 900 tonnes are imported offically, it must be remembered that, as per the World Gold Council’s data, only 3,000 tonnes are produced a year globally. The government must immediately publish the study report which contains the finding that gold traders in Kerala do business worth Rs 1,13,400 crore a year (Rs 310 crore a day). It is clear that the report was prepared by some agencies as per the instruction and interest of big players.
One of the goals changing the tax structure in the state is to paint everyone except a few big merchants as tax evaders. This does not suit responsible business organisations. The tax structure in gold business must be revised. But that must be on the basis of factual evaluation and general discussion, and not on the basis of study reports that have not come to light and inflated figures, Kamat said.