Australian Federal Police issued a press release today alleging "companies fraudulently claimed GST credits and failed to report GST correctly. They formed syndicates to conceal the true nature of their activities and to avoid detection."
GST is a Australian sales tax of 10% that applies to precious metals that do not meet the definition of investment. It likely that the fraud involves scrap gold or silver where GST is payable. Note that it is being classified as "organised crime" which allows the police to invoke proceeds of crime laws so the people behind it can't hide behind the bankruptcy of the companies involved.
Hmm, isn't this similar to what Kitco in Canada is going through?
ReplyDeletea common crime also in Germany (with 19% VAT on gold, really lucrative):
ReplyDeletehttp://www.zeit.de/2010/48/Umsatzsteuerbetrug-Steuerhinterziehung
Estimations are in the billions.
This is something that makes me wonder if I am actually holding a "store of value", or am I holding just a tax fraud vehicle in my hands, that will drop like a stone, ones the tax loop holes are closed?
Greets, AD
P.S.
ReplyDeleteI am saying this, since I know a local scrap gold dealer, that pays just 3% below spot. He and some of his employees (unskilled) look like making lots of money (spending really money on luxury cars, houses etc.)
I wonder if that is possible if paying 3% below spot for scrap?
Bron, do you have any insides you are allowed to share about scrap gold business? What is reasonable and what isnt?
Greets, AD
Thanks for that link. 3% seems reasonable for a normal business, but not enough profit from 3% to pay for luxury cars etc.
ReplyDelete