The government on Tuesday released the draft guidelines for its ambitious gold monetization scheme that aims to cut down gold imports in the country. The guidelines have been notified nearly three months after the scheme was announced by Finance Minister Arun Jaitley in the Union Budget.
NDTV has summarized the salient features of the gold mobilization scheme:
1) The scheme is meant to mobilize gold held by domestic households and institutions. Gold collected through the scheme will be made available to jewelers for manufacturing of new jewellery and other items.
2) The scheme will initially be launched at a few places because the government will have to first set-up infrastructure for facilitating easy and secure handling of gold.
3) Gold collected from consumers will first be cleaned and measured at test centres; it would then be melted to test for purity. After the tests, consumers can either deposit the gold for a fee or take it back after paying a nominal fee.
4) The minimum quantity of gold that a customer can bring is proposed to be set at 30 grams.
5) Those willing to deposit the gold will be given a certificate mentioning the amount and purity of the deposited gold. Banks will open a ‘Gold Savings Account’ on the basis of such certificates.
6) Consumers will be paid interest on their gold savings account after 30/60 days of account opening. The amount of interest rate to be given is proposed to be left to the banks to decide.
7) Both principal and interest will be paid to the depositors of gold, will be ‘valued’ in gold. For example if a customer deposits 100 gms of gold and gets 1 per cent interest, then, on maturity he has a credit of 101 gms.
8) The customer will have the option of redemption either in cash or in gold, which will have to be exercised in the beginning itself (that is, at the time of making the deposit).
9) The tenure of the deposit will be minimum 1 year and in multiples of one year. Like a fixed deposit, breaking of locking period will be allowed.
10) Gold savings account will be exempt from capital gains tax, wealth tax and income tax.
According to the government, gold deposit accounts will utilise the 20,000 tonnes available within the country and help in cutting down the 800-1,000 tonnes of gold the country ships every year. The last day for submitting feedback on draft guidelines with the finance ministry is June 2.
Increase rate of Interest and Start interest accrual date from “deposit”date irrespective of crediting or payment of account to attract more by amending “melting” point to gain temple/ household jewellary after considering viability.-CMA Ramarao.
Govt should prepare separate scheme for Religious Trusts ,Mandir ,Temples where ample gold is lying .Also Govt shall is Gold Bonds to reduce investment in Gold .Interest rate must be attractive so people will deposit Gold in Banks
The jewellery with the househols will not come out under the scheme as the same is being melted and converted. The sentiments of an indian lady will melt with the melting. No lady will allow her jewellery to go out via such a channel in this situation. The very purpose will get defeated. However if TAX BENEFITS are there it may bring black money out.
More clarity required on whether source of investment in gold will be questioned or not.Further whether gold ornaments will be accepted or not…
Any insurance cover not found. All normal deposits to gather are covered by DICGC -Deposit Insurance and Credit Guarantee Corporation of India up to Rs. 1,00,000\-. Since this meager amount is not updated since more than 20 years either by Bankers or by RBI the separate cover is required. Government may raise DICGC cover to at least Rs. 60,00,000\-. Else there should be separate insurance cover for Gold Saving Account from DICGC.
1% INTEREST IS VERY LOW IN PREVIOUS SCHEME INTEREST WAS 4%& ALSO EXEMPT IN WEALTH TAX THAT IS SAVING OF 2%WEALTH TAX NOW THERE IS NO WEALTH TAX S THERE WILL BE NO INCENTIVE IN THIS SCHEME
Jewelry seized by the Income-tax Department during the course of search and retained for pending proceedings, assessee should be allowed to put such jewelry in the Gold Monetization Scheme.