Russians will be Offered Gold Instead of Dollars
According to Russian media, Russia is actively getting rid of the dollar, buying gold in international reserves. Moreover, the president Putin signed a law abolishing the 20% value added tax levied on the purchase of precious metals by natural persons. The prospects for citizens opened as a result, why invest in gold at all, how profitable such investments are and whether they can be considered as an alternative to the dollar and the euro.
In accordance with the law, transactions on attracting precious metals to deposits of not only legal entities but also individuals are exempt from VAT at a rate of 20%. And we are talking about gold bars.
Unlike impersonal metal accounts (where VAT is charged only with withdrawal of metal in physical form), when you buy bars, you have to pay VAT, the same 20%. The tax actually negated the expediency of investing in physical gold and deprived it of investment attractiveness.
This market bias has long been discussed in the Ministry of Finance and now decided to eliminate it. The abolition of VAT is a powerful measure of support for the gold industry in Russia, the third largest producer of precious metals in the world (after China and Australia). Domestic gold miners do not have the right to export gold in its pure form and are almost completely dependent on the Central Bank, as well as other large banks that provide up to 80% of the demand. Now, according to analysts, the market will expand by ten percent – at the expense of individuals.