Thiruvananthapuram, Sep 7 (IANS): Kerala Chief Minister Pinarayi Vijayan's direction to officials on Tuesday to ensure that tax evasion by gold merchants is strictly curbed through means like connecting CCTVs of gold shops to GST offices and police stations has evoked a sharp reaction from the merchants.

Kerala Gold and Silver Merchants association body A. Abdul Nasser said that it is most unfortunate that officials have misled the Chief Minister.

"There has been no discussion or deliberation with us on any aspect and they (the government) are coming out with arbitrary decisions. Everyone knows that tax collected from us has gone up in the present GST time compared to the previous VAT regime. A reply to our RTI query on this is yet to be answered. We express our strong protest in the way things are going to be looked into by the government, after its meeting on Tuesday," he said.

Earlier on Tuesday, Vijayan chaired a meeting of tax and other officials to stress on strict vigil to foil tax evasion, especially by gold merchants. The Chief Minister also questioned if it was possible to connect CCTVs in big gold shops to the police station and tax offices.

Incidentally, according to a source in the know of things, during the VAT regime in an year, the tax collected on gold sales in the state was around Rs 630 crore and after GST came into effect, it shot up to Rs 850 crore.

Moreover, the gold merchants often bring in gold from neighbouring states and then converts into jewellery and for that they pay the tax in the state from where it is purchased.

Kerala is presently going through one of its worst-ever financial crises as its public debt has crossed Rs 4 lakh crore and ever since Vijayan took over in 2016, it has almost doubled in a period of nearly six years and the only way to go forward is to jack up revenue collections.