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Introduction of Sovereign Gold Bonds Scheme

Dated:- 9-9-2015 - The Union Cabinet chaired by the Prime Minister, Shri Narendra Modi, today gave its approval for introduction of the Sovereign Gold Bonds Scheme, as announced in the Union Budget 2015-16. The scheme will help in reducing the demand for physical gold by shifting a part of the estimated 300 tons of physical bars and coins purchased every year for Investment into gold bonds. Since most of the demand for gold in India is met through imports, this scheme will, ultimately help in ma .....

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ransferred to the Gold Reserve Fund. The salient features of the scheme are:- i. Sovereign Gold Bonds will be issued on payment of rupees and denominated in grams of gold. ii. Bonds will be issued on behalf of the Government of India by the RBI. Thus, the Bonds will have a sovereign guarantee. iii. The issuing agency will need to pay distribution costs and a sales commission to the intermediate channels, to be reimbursed by Government. iv. The bond would be restricted for sale to resident Indian .....

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as decided. vi. The bonds will be available both in demat and paper form. vii. The bonds will be issued in denominations of 5,10,50,100 grams of gold or other denominations. viii. The price of gold may be taken from the reference rate, as decided, and the Rupee equivalent amount may be converted at the RBI Reference rate on issue and redemption. This rate will be used for issuance, redemption and LTV purpose and disbursement of loans. ix. Banks/NBFCs/Post Offices/ National Saving Certificate (N .....

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to be set equal to ordinary gold loan mandated by the RBI from time to time. xii. Bonds to be easily sold and traded on exchanges to allow early exits for investors who may so desire. xiii. KYC norms will be the same as that for gold. xiv. Capital gains tax treatment will be the same as for physical gold for an 'individual' investor. The Department of Revenue has agreed that amendments to the existing provisions of the Income Tax Act, for providing 'indexation benefits to long term .....

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