Kerala plans video surveillance in jewelry stores to fight tax evasion
In a bid to tackle tax evasion by gold traders, the Kerala government is considering the possibility of live video surveillance in jewelry stores, in addition to stepping up surprise checks.
This new move has sparked resentment among thousands of gold traders in Kerala, which is one of the flourishing markets for the yellow metal. A decline in tax revenues from gold prompted the state government to tighten its grip on gold merchants. The new movements are also a follow-up to Kerala’s long-standing demand for the introduction of an electronic bill for gold.
A meeting chaired by Chief Minister Pinarayi Vijayan on Tuesday decided to step up inspection by tax officials in jewelry stores. The chief minister explored the possibility of enforcing video surveillance in major jewelry stores, with tax officials and police having access to video surveillance units in stores.
Angered by the measures, representatives of the All Kerala Gold and Silver Merchants Association said the government’s new measures would worsen the harassment traders already face from law enforcement officials.
According to sources, Kerala’s tax revenue from gold which was previously above Rs. 600 crore has come down to nearly Rs. 250 kernel after the introduction of the GST. Kerala has around 7,000 registered jewelers. The smuggling of gold to Kerala from other countries via airports is also considered to be at an alarming level.
The state government demanded that the electronic invoice be introduced for gold, citing that the lack of an electronic invoice was the main reason for tax evasion. However, gold traders in some states like Gujarat objected, citing the security risks associated with transporting gold as an electronic waybill could make details of the movement of gold known to d ‘others. The state government is also in the process of introducing an electronic invoice for the intrastate movement of gold.
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