THIRUVANANTHAPURAM: It is not just the Left, even Congress leaders are opposed to the proposed Gold Tax Bill, which seeks to reduce VAT on gold from five to two percent and abolish the compounding system. KPCC vice president V D Satheeshan, who had objected to the Bill at the Assembly’s Subject Committee on Tax, said it would cause a loss of at least Rs 300 crore and would let loose massive evasion. Collection, in effect, will fall considerably below the Rs 457 crore collected during the 2014-15 fiscal.
History, too, offers a warning. “In 2005, when the then UDF government had reduced tax from four to one percent, revenue from gold dropped dramatically to Rs 20 crore from Rs 100 crore,” Satheeshan said.
The Congress leader expressed the hope that the Bill would not be piloted at this stage in the UDF’s tenure.
“It would be politically suicidal to make such a change in tax policy on the eve of the Assembly elections. The Left will unnecessarily bring up conspiracy theories,” Satheeshan said.
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