• 5 minutes Iran Says It Arrested 17 CIA Spies, Some Sentenced To Death
  • 9 minutes Will We Ever See 100$+ OIL?
  • 13 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 18 hours Iran Loses $130,000,000 Oil Revenue Every Day They Continue Their Games . . . .Opportunity Lost . . . Will Never Get It Back. . . . . LOL .
  • 13 mins Platts says if Iran's 2 mm bbls exports comes back on market oil goes to $40 . . . What about new Permian pipelines 2.47 mm bbls coming ? . . . WHAT IF BOTH IRAN AND PERMIAN TOTAL 4.47 mm added bbls . . . OMG !
  • 4 hours Today President Trump Questioned U.S. Policing the Straits of Hormuz for Rich Asian Countries. Allies Britain and Japan were asked to participate. Said NO. US spends $100 Billion/year Protecting Mideast Shipping Lanes!
  • 11 hours Renewables provided only about 4% of total global energy needs in 2018
  • 19 mins Millions of Barrels of Iranian Oil Are Piled Up in China’s Ports
  • 8 hours So You Think We’re Reducing Fossil Fuel? — Think Again
  • 3 hours N.Y. Governor Signs Climate Bill
  • 7 hours Oil Giant Saudi Arabia Is Set to Start First Wind-Power Plant
  • 1 day Berkeley becomes first U.S. city to ban natural gas in new homes
  • 20 hours U.S. Administration Moves To End Asylum Protections For Central Americans
  • 1 day How is E&P of Marginal Oil on the UKCS Similar to the Shale Oil Operations in the US?
  • 7 hours EIA Reports Are Fraudulent : EIA Is Conspiring With Trump To Keep Oil Prices Low
  • 1 day Trump vs. Xi Trade Battle, Running Commentary from Conservative Tree House
Alt Text

What The Market Is Overlooking In The Occidental Deal

Occidental Petroleum has caught a…

Alt Text

This Supermajor Is Leading The Energy Sector

This supermajor has been standing…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

India Just Shocked The Gold Market With This Unexpected Tax Hike

I wrote a few weeks ago about record slowdowns in gold sales across India. With buyers in the world’s number-one consuming nation holding off on purchases ahead of an expected cut in import taxes from the federal government.

And yesterday we got the decision from India’s officials on the gold tax. Although it wasn’t at all what the market had hoped for. Related: Oil Giant Cuts Budget By 80 Percent And Suspends Fracking

Finance Minister Arun Jaitley presented the government’s gold plan as part of the annual federal budget. Saying that gold import taxes will remain unchanged this year – dashing hopes for a cut.

In fact, Jaitley actually announced an increase in taxes on gold sales. Saying that the government will add a sales tax of 1 percent to all gold jewelry sold in India.

Such a sales tax had been scrapped by the government four years ago. But is now being revived by officials with the stated aim of reducing gold consumption. Related: What Would Negative Interest Rates Mean for the Oil Market?

And that wasn’t the end of increased taxation on bullion. With Minister Jaitley also saying he will raise taxes on imports of dore gold bars – to 8.75 percent, from a former 8 percent.

Dore purchases had recently become a preferred way for India’s gold buyers to get a break on the 10 percent import tax for refined gold. But the new tax significantly narrows the arbitrage here.

All of which suggests that the government is very serious about reducing gold demand – in order to keep down the country’s current account deficit. Related: Electric Vehicles Could Soon Reduce Oil Demand By 13 Million Barrels Per Day

The increased taxes could also be aimed at driving buying away from physical gold. And toward paper instruments such as the gold-backed bonds recently introduced by the government.

Whatever the case, these measures are very likely to have a dampening effect on gold purchases in this key market. Watch for statistics on gold purchases to see how great the damage will be.

Here’s to sticking with it

By Dave Forest

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play