High gold prices and steep taxes are driving more Indian buyers into under-the-counter cash sales, where bullion and jewelry change hands without invoices that can be traced by authorities.
Buying off the books with cash can shave as much as 6% from prevailing market prices for bulk buyers, according to five people familiar with the trade, asking not to be named discussing a sensitive matter. Dealers accepting cash can sidestep taxes and pass part of the savings on to customers.
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One shopper, who gave her name only as Anuradha, said she had bought ornaments for her daughter’s wedding at a discount of 5,000 rupees ($52) for every 10 grams — but took no receipt. The savings were hard to ignore for the 55-year-old homemaker after gold surged to a record earlier this year. Prices have since eased but remain almost 28% higher than a year ago.
“It was an offer I couldn’t refuse. Gold prices are way too high and we trust the jeweler,” she said, asking that only her first name be used because of the sensitivity of the transaction.
