Kerala is gearing up to reiterate its demand with the Centre and at the Goods and Services Tax Council to make e-way bill mandatory for gold transport to curb smuggling and deter tax evasion.
Finance Minister T. M. Thomas Isaac who had consistently voiced the State’s concerns and the need for streamlining the movement at council meetings had to retreat for want of adequate support from other States.
A spurt in gold smuggling cases of late and a recent instance of seizing gold smuggled in air cargo shipments addressed to the United Arab Emirates consulate here have once again brought into focus the need to regulate and monitor gold movement within the country.
Finance Department sources told The Hindu that the State government does not favour a raid regime to harass traders. Being a complex and laborious process, it is not feasible to mount a foolproof operation either. Hence, Kerala has been flagging the demand, but it has been allegedly cold-shouldered by the Centre, primarily citing security concerns, sources said.
The present GST infrastructure does not offer any room for plugging the source from where the contraband originates and detecting the end beneficiary. Still the option has been back-burnered, sources said.
Even if the State’s tax sleuths track and seize illegally carted gold, the culprits get away paying a 3% tax and 3% fine. Department officials booked 344 cases, seized 307.64 kg of gold and collected ₹6.98 crore as tax and penalty between 2017 and 2020. A lion’s share of the seizure was ornaments. Such carriers usually cart ornaments from manufacturing centres in Maharashtra and Gujarat and if it is not for sale they carry only a delivery chalan. Having e-way bill is the only option to check the menace, sources said.
Seizure or confiscation under Section 129 and 130 of the GST Act that empowers seizure, levying of penalty, confiscation and release of gold in transit has too many complications. Though department officials shadow carriers and deter them, keeping a tab on legions of carriers across the State is unviable, sources said.