Ten percent tax imposed on gold imports

Redbulls · 1 Ten percent tax imposed on gold imports Fri Jun 21, 2013 12:04 pm

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Sri Lanka has imposed a 10 percent tax on gold imports with immediate effect, a top government official said on Friday.

"The government has imposed a 5 percent customs duty and another 5 percent surcharge on gold imports," a top government official who is involved with the decision making told Reuters on condition of anonymity.

"There is an increase in gold imports and we have seen some people using the situation as an arbitrage with India having a tax. We also have found some leackages and we want to prevent this."

Recently, Sri Lankan customs nabbed a series of people suspected of smuugling gold out of the country at airports. (Reuters)
http://ceylontoday.lk/16-35587-news-detail-ten-percent-tax-imposed-on-gold-imports.html

VISA · 2 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 12:21 pm

VISA

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good timely intervention.

malanp · 3 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 12:23 pm

malanp

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SAMP will go up

people who sold SAMP with gold fear, have to buy back at higher prices..

traderathome · 4 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 12:48 pm

traderathome

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Ayyo madi 10% the way GOLD slid from 1900 to 1280 the 10% is peanut know.
May be CABBA collected GOLD through PAYPAL payment system and he wants to impose on the masses.thinking GOLD rush has come in

I want to buy physical gold ....NOW but no money.

traderathome · 5 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 12:50 pm

traderathome

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i sold my stake in SAMP.N... Sad

bad timing i guess.
dont like the PA now

TAH

D.G.Dayaratne · 6 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 1:25 pm

D.G.Dayaratne

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SDB prices will go up again

Although fundamentals are good prices come down dramatically
due to brokers advice and manipulation based on gold prices
after payment reasonable dividends

Redbulls · 7 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 1:29 pm

Redbulls

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D.G.Dayaratne wrote:SDB prices will go up again

Although fundamentals are good prices come down dramatically
due to brokers advice and manipulation based on gold prices
after payment reasonable dividends

Seems to be you fall in love with this counter. Good one.

sriranga

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By Shihar Aneez

COLOMBO, June 21 (Reuters) - Sri Lanka has imposed a 10 percent tax on gold imports with immediate effect to curb overseas purchases by traders looking to take advantage of a favourable price arbitrage with top consumer India, two government officials said.

While Sri Lanka did not have a duty on gold prior to this, its neighbour India hiked import taxes for the metal by 33 percent earlier in June to rein in a ballooning trade deficit. Sri Lankan customs have recently nabbed a number of people suspected of smuggling gold out of the country at airports.

'There is an increase in gold imports and we have seen some people using the situation as an arbitrage with India having a tax. We also have found some leakages and we want to prevent this,' a top Sri Lankan government official told Reuters on Friday on condition of anonymity.

'The government has imposed a 5 percent customs duty and another 5 percent surcharge on gold imports,' said the official, who is involved with the decision making.

Treasury Secretary P.B. Jayasundera also confirmed that the customs duty was imposed 'to prevent arbitrage with India', though he did not say how much the tax was.

Sri Lanka's imports of the precious metal jumped 46.7 percent from a year ago to $110 million in the first four months of this year. It imported gold worth $50 million in April alone, provisional data from the central bank showed.

The value of gold imports sank to $170 million in 2012, from a record $604 million in 2011 after the central bank tightened monetary policy twice and adopted a flexible exchange rate.

'This is a sensible and timely move to prevent another balance-of-payment and exchange rate crisis,' a currency dealer said on condition of anonymity. 'If imports increase, there will be a depletion in foreign currency reserves as we experienced in 2011, thus pressurising the exchange rate.'

Sri Lanka has also seen a surge in gold pawning, a popular method of borrowing against the metal, and commercial banks' exposure to this grew 20 percent to around 339.4 billion rupees ($2.64 billion) in 2012, or about 14.4 percent of the year's total loans, central bank data showed.

Some bankers said the exposure was now more than 500 billion rupees and that recovering this money had become difficult with a drop in global gold prices.

Spot gold has plunged 22 percent so far this year, after gaining for the last 12 years.

'A tax would help to adjust the prices,' Central Bank's Economic Research Department Chief Swarna Gunaratne said. 'The central bank has already advised banks on pawning as we had a concern on this.'

($1 = 128.3500 Sri Lanka rupees)

(Editing by Himani Sarkar)

(shihar.aneez@thomsonreuters.com)(+94-11-232-5540)

(Reuters Messaging: shihar.aneez.thomsonreuters.com@reuters.net)(twitter.com/shihara neez)
http://www.xe.com/news/2013/06/21/3407185.htm

Vptilak · 9 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 9:43 pm

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PPL who imported before this tax are now enjoying a minimum of 10% profit.

traderathome · 10 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 10:47 pm

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This country is scared when prices SLUMP.
OIL /GOLD etc etc.
BUT CB should BUY Gold now and keep in its reserves.

traderathome · 11 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 10:51 pm

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I am sure Big Banks are waiting to catch the Bottom of GOLD.

Cabba must have eyed on this ........potential,perhaps waiting for some more correction to complete, before the big boys come into play again.
Anyways we will see Honda Honda sellang very soon..
TAH

traderathome · 12 Re: Ten percent tax imposed on gold imports Fri Jun 21, 2013 11:09 pm

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A new report by the World Gold Council, “Central bank diversification strategies – rebalancing from the dollar and the euro”, examines the growing trend of central banks’ actively looking to diversify their reserve portfolios. While the dollar is still the primary global currency, its long-term dominance is less certain. In response, central banks are reducing allocations to US dollars and euros while increasing purchases of traditional assets such as gold and Japanese yen and new alternatives including Chinese renminbi.
The official reserves of global central banks have grown from $2 trillion in 2000 to more than $12 trillion in 2012. During this same twelve-year period the data shows significant shifts away from the US dollar while the share of “other” currencies in reserve composition has tripled in absolute terms since 2008.
Gold has a long history as a reserve asset for central banks, and as such is considered a traditional one. Gold is statistically uncorrelated with other traditional reserves and new alternatives, making it one of the most important assets for diversifying out of the US dollar and euro. In line with this trend, central bank gold buying in the fourth quarter of 2012 marked the eighth consecutive quarter of net purchases by the official sector and the highest level since 1964.
Ashish Bhatia, Manager for Government Affairs at the World Gold Council said:
“Building gold reserves in tandem with new alternatives is an optimal strategy as central banks remain under-allocated to gold and many attractive alternatives are either too small or, as is the case with the renminbi, not yet open to broader international participation.
“Gold has a deep and liquid market with no credit risk, making it one of the most attractive assets for central banks to consider as they diversify away from the US dollar and euro. Gold’s tail-risk hedging properties add to its appeal as a particularly valuable component of a diversified reserve portfolio.”
The study is predicated on the assumption that central banks will continue to hold 65% of their assets in dollars and euros, while looking for high quality alternatives including Chinese, Canadian, Australian, Swiss, and Danish denominated assets for the balance of their reserves. It quantifies the benefits of these alternatives using portfolio optimisation methodology and examines their diversification benefits while providing context for potential limits to their use due to limited availability or access.
Key findings include:

Chinese renminbi and Australian assets emerge in this study as important assets for diversification. However, in the portfolio optimisation analysis which took into account market size and access constraints, gold received a prominent 8% allocation, surpassing the 4% allocation to renminbi and 3% to Australian assets. Gold’s allocation was matched only by Japanese yen which was also weighted at 8% of the optimised portfolio.

Due to the large size of the gold market, approximately $3.2 trillion, central banks have sufficient access to gold for large investments. The gold market is highly liquid with average daily trading volume estimated at $240 billion.

Emerging market central banks are investing in assets denominated in the following currencies: Canadian dollar (CAD), Australian dollar (AUD), Swiss franc (CHF), Danish krone (DKK) and Chinese renminbi (CNY). Given part of the strength of alternative assets is related to economic growth and commodity sector strength, these assets also carry risks that are associated more broadly with economic cycles.

The size limitation of alternative reserve assets actually re-emphasizes the role traditional assets can play in diversification. In the market scenario optimisation, which adjusts for the market size of a particular asset, there is a greater allocation to traditional assets such as gold (8%), JGBs (8%), and Gilts (6%), than to alternatives such as the Swiss franc (1%), Danish krone (1%), and Australian dollar (3%).

Despite the attraction of the Chinese renminbi market, it remains difficult to access. Foreign investors must be part of the QFII programme which currently consists of approximately 13 central banks and sovereign related entities. Participation by individual institutions is limited to $1 billion, which is too small to provide adequate scale for central banks.

This analysis demonstrates that gold and traditional reserve assets can play a complementary role alongside alternative assets as central banks seek diversify their US dollar and euro heavy reserve portfolios. The results suggest it would be prudent for reserve managers to build gold reserves to achieve optimal levels relative to other traditional and alternative reserve assets.
The full text of “Central bank diversification strategies – rebalancing from the dollar and the euro” can be viewed here.
For further information please contact:
David Schraeder
World Gold Council
http://www.gold.org/media/press_releases/archive/2013/03/central_bank_diversification_strategies_press_release/

balapas · 13 Re: Ten percent tax imposed on gold imports Fri Jun 28, 2013 8:07 pm

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traderathome wrote:Ayyo madi 10% the way GOLD slid from 1900 to 1280 the 10% is peanut know.
May be CABBA collected GOLD through PAYPAL payment system and he wants to impose on the masses.thinking GOLD rush has come in

I want to buy physical gold ....NOW but no money.

A day before 10% tax on gold the price was Rs45,500 for 24k pound in SL and now it has come down to RS43,000. So 10% tax increase is reversed. There is a c.25% drop in gold price within 3 months to-date. TAH if you come to SL you can bring 200g of gold which I clarified with a custom guy. Buy something like PAMP gold biscuits (buy 2 100g biscuits) so no question about authenticity. They are slightly expensive about 1% more since its like collectors item and has the highest purity of .9999. You can get a good value for this. Buy it from your company name if possible to get a better price but difference in price is not much.

Last edited by balapas on Fri Jun 28, 2013 8:43 pm; edited 1 time in total (Reason for editing : Today gold price update)

traderathome · 14 Re: Ten percent tax imposed on gold imports Sat Jun 29, 2013 11:24 am

traderathome

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In UAE there is a licensed Company approved by Dubai Government selling on Internet.Havent tried it.They do charge something like 10% based on spot rate.
Better to BUY now something for my family.Bought already for my daughter when it HIT 1375.
I am wondering why Big Governments dont increase there GOLD reserve.
TAH

Jake Sully · 15 Gold Sat Jun 29, 2013 3:09 pm

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traderathome wrote:In UAE there is a licensed Company approved by Dubai Government selling on Internet.Havent tried it.They do charge something like 10% based on spot rate.
Better to BUY now something for my family.Bought already for my daughter when it HIT 1375.
I am wondering why Big Governments dont increase there GOLD reserve.
TAH

FYI, Emirates NBD has a new gold scheme where you can buy gold at the market price but you don't have to physically keep the gold. Whenever you want you can sell it. It's similar to buying shares.

rainmaker · 16 Re: Ten percent tax imposed on gold imports Sat Jun 29, 2013 7:33 pm

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Of all the luxury items this was never taxed ... biggest rort next to diamonds

traderathome · 17 Re: Ten percent tax imposed on gold imports Sat Jun 29, 2013 8:38 pm

traderathome

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Jake Sully wrote:

traderathome wrote:In UAE there is a licensed Company approved by Dubai Government selling on Internet.Havent tried it.They do charge something like 10% based on spot rate.
Better to BUY now something for my family.Bought already for my daughter when it HIT 1375.
I am wondering why Big Governments dont increase there GOLD reserve.
TAH

FYI, Emirates NBD has a new gold scheme where you can buy gold at the market price but you don't have to physically keep the gold. Whenever you want you can sell it. It's similar to buying shares.

But what about if i want it to convert to physical gold. Suspect