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Dump dollar for gold: Russia mulls eliminating gold tax to boost investment at greenback’s expense

Dump dollar for gold: Russia mulls eliminating gold tax to boost investment at greenback’s expense

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Russia’s Finance Ministry told the Izvestia newspaper it is considering complete abolition of value added tax (VAT) on gold purchases. This would give Russian savers an option of investing in gold, rather than foreign currencies. The ministry said earlier the measure could also help returning capital worth tens of billions of rubles to the country. Gold bar buyers in Russia are currently obliged to pay 20 percent VAT. However, when selling ingots, the tax is not returned. As a result, demand for gold investment in the country sits at just under 3 tons per year. Experts say that if the tax is dropped, demand could skyrocket to 50-100 tons. The abolition of VAT will create an investment gold market in Russia, Sberbank Vice President Andrey Shemetov told the newspaper. According to him, as a financial instrument, gold is protected from inflation, and at a time of geopolitical risks, the metal could be an excellent substitute for traditional investments in US dollars. Resetting the VAT…
Source: Dump dollar for gold: Russia mulls eliminating gold tax to boost investment at greenback’s expense

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