Please view the main text area of the page by skipping the main menu.

Gov't to crack down on gold smuggling through beefed up ID requirements

Smuggled gold bullion is seen at the Chitose Customs Sub-Branch of Hakodate Customs in Hokkaido in this December 2017 file photo. (Mainichi)

TOKYO -- The government and ruling parties are poised to beef up measures to confirm the identities of gold importers as part of efforts to combat rapidly increasing gold smuggling.

The move comes as the consumption tax is scheduled to be raised from the current 8 percent to 10 percent in October next year. Under the proposed scheme, dealers that purchased gold could not receive consumption tax deductions unless they submit copies of the sellers' IDs.

While the consumption tax is levied on gold when it is imported, smugglers bring gold into the country without paying the tax. Instead, they add the amount onto the sale price of the gold and pocket the profit. Meanwhile, dealers that purchase gold owe the authorities the difference between the consumption tax they pay to the importer and that they receive when they resell the precious metal.

Currently, gold buyers are not required to submit the IDs of importers to the authorities, and they can claim tax deductions just by presenting purchase ledgers. The new scheme will require dealers to submit copies of the importers' IDs, such as driver's licenses and passports, to receive the deductions. Those who acquired gold knowing it was smuggled will not be given the tax breaks.

By keeping gold dealers on a tighter leash, the government expects to see increased consumption tax revenue and thwart smuggled gold transactions. The new policy will be incorporated into the government's tax system reform outline to be compiled at the end of the year.

(Japanese original by Daisuke Oka, Business News Department)

Also in The Mainichi

The Mainichi on social media