Govt To Issue Sovereign Gold Bonds On Nov 5; Offers 2.75 % Interest
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The Sovereign Gold Bonds will offer an interest rate of 2.75 per cent and will remain open for public subscription between November 5-20, Finance Ministry said on Friday.
Aimed at providing an alternative to buying physical gold, the gold bond scheme will offer investors a choice to buy bonds worth 2 grams of gold, up to a maximum of 500 grams.
“The bonds will be issued on November 26, 2015. Applications for the bond will be accepted from November 5, 2015 to November 20, 2015.
“The bonds will be sold through banks and designated post offices as may be notified,” a Finance Ministry statement said.
This is the first tranche of the gold bond scheme and subsequent tranches would be notified later, it added.
The tenor of the bond will be for a period of eight years with exit option from 5th year to be exercised on the interest payment dates, the statement said.
“Price of bond will be fixed in Indian Rupees on the basis of the previous week’s (Monday-Friday) simple average of closing price of gold of 999 purity published by the India Bullion and Jewellers Association Ltd,” it added.
The same procedure would be followed for calculating the redemption price for the bonds.
The report added the procurement costs may be reduced on account of reduction of non-creditable taxes, which will make the Indian industry competitive.
It expects that in the medium-to-long term, the Indian industry will be able to migrate to an efficient supply chain model as against the present supply chain model, which is dependent on tax considerations vis-a-vis operational considerations.
The report expects GST to contribute to the government initiatives like Make in India and Ease of Doing Business.
However, it added that it is important that the proposed GST legislation is easy to implement and has simplified compliance processes.
“While the GST regime may provide opportunities to the transport and logistics sector, there are also several issues to be addressed. The industry must engage in discussions with the government to capitalise on the opportunities that the new tax regime has to offer,” it said. (PTI)
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