Kathmandu. China has given a big blow to the world in terms of gold. It will also affect the Chinese people.
The rule came into effect on November 1. China has decided to end the tax exemption (VAT exemption) on the sale of gold. This could increase consumer costs and give a major blow to the world’s largest bullion market.
According to a Bloomberg report, China’s Ministry of Finance has decided that gold retailers will no longer be allowed to refund VAT on the sale of gold purchased from the Shanghai Gold Exchange, effective November 1. Simply put, any sale of gold purchased on the Shanghai Exchange will not be tax-free.
This rule applies to all types of gold. Whether it’s sold directly or processed into jewelry, coins, high-purity bars or industrial materials. This represents a major change in taxation.
{{TAG_OPEN_strong_15}What will be the impact of this decision?
China’s Ministry of Finance has decided to remove VAT exemption on gold at a time when China’s economy is slowing. The real estate and construction sectors are not experiencing the same growth as before. The decision comes in response to China’s search for new opportunities for economic growth.
The removal of VAT exemption could increase government revenue. However, this situation will lead to higher rates for customers buying gold in China.
China is one of the world’s largest consumers of gold. Changes in prices or demand are directly reflected in global markets. According to experts, this Chinese rule is likely to increase the price of gold markets around the world. However, the price of gold worldwide is hovering around $ 4,000 per ounce. Some have speculated that it could reach $5,000 per ounce within a year.
