Core Insights - The recent announcement by the Ministry of Finance and the State Taxation Administration regarding gold tax policies introduces a differentiated tax system based on the purpose of gold usage, moving away from a one-size-fits-all VAT approach [1][2] Tax Policy Changes - The new policy establishes a purpose-oriented tax classification system, allowing investment gold traded on exchanges to continue enjoying VAT exemptions, while non-investment gold will be subject to existing VAT regulations without access to tax benefits through exchange channels [2] - This reform aims to close tax loopholes, ensure fiscal revenue, and encourage long-term holding of physical gold while discouraging high-frequency trading and short-term speculation [2] Market Structure Impact - The new policy is expected to significantly reshape the domestic gold market, increasing transaction concentration towards exchanges as institutional investors prefer to conduct large transactions through exchanges to avoid VAT costs [3] - Retail demand will likely see a clear division, with ordinary investors opting for bank-mediated exchange products like gold ETFs, leading to a decrease in direct purchases of physical gold bars [3] - Non-exchange channels will face pressure to adapt, with some gold shops shifting towards customized services or collaborating with exchanges for innovative sales models [3] Price Dynamics - The price gap between investment gold bars and gold jewelry is expected to widen, as exchange-traded investment gold will be VAT-exempt, aligning more closely with international gold prices, while jewelry prices will include various taxes [4] - In the short term, the implementation of the new policy may lead to increased supply and downward pressure on prices as some investors sell off gold from non-exchange channels, but long-term price trends will still be influenced by fundamental factors such as inflation expectations and geopolitical tensions [4] Investor Behavior Changes - Institutional investors are likely to shift towards on-exchange trading to minimize tax costs, while individual investors may diversify their portfolios through low-threshold products like gold ETFs [5] - The preference for physical gold is expected to concentrate more on consumption scenarios, with long-term holding becoming more attractive due to reduced exit costs for long-term investors [5]