As GST council explores the implementation of E way bills in respect of Gold and precious stones, they face a very formidable roadblock in front of them in form of Secrecy of information pertaining to movement of consignment. E way bill is considered as an important tool in fighting the tax evasion in gold but for moving ahead, they would have to find a solution to these issues.
E- way bill is required to be generated for movement of goods valuing more than Rs. 50,000/- in a motorized vehicle. As of now gold and precious stones are exempted from E-way bill.
In November 2019, GST Council formed a group of ministers (GOM) to explore the feasibility of implementing E-way bills for movement of gold and precious stones. The Group of Ministers comprised of finance ministers from states of Kerala, Gujarat, West Bengal, Bihar, Punjab and Karnataka. GOM held the virtual meeting via video conferencing on 14th Aug 2019 presided by TM Thomas Issac, Finance Minister of Kerala wherein these issues were deliberated upon.
But the main issue in implementing E-way bills in this case is that data of transport of gold and precious stones would be revealed. This concern was also raised by Gujarat in the held video conference meeting. The e-way bill system tracks the movement of goods and consignment. This leads to security concerns and therefore secrecy of uploaded information stands as the main roadblock in the implementation of E way bill system for gold and precious stones.
The panel as of now is not in favor of implementing the E-way bill system for inter state movement of goods citing complexity but has agreed to introduce it for intra state movement of gold. Therefore, it would be on the states to decide on the E-way bill for gold in respect of movement within their state. The information was communicated to PTI by Sushil Modi, Deputy Chief Minister of Bihar also holding the finance portfolio, after the video conference meeting.
Even proposals like extending e-invoicing to gold, tax on reverse charge mechanism on sale of old gold shall be explored in the future meetings by group of ministers before submission of the final recommendations to the GST Council which would then take the final call.
Tax Pyramid welcomes the efforts being done to put in place a framework to control tax evasions in gold.
