Tax Policy - The announcement from the Ministry of Finance and the State Administration of Taxation states that transactions of standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange will be exempt from value-added tax (VAT) for sellers if there is no physical delivery [7][8] - For members purchasing standard gold for investment purposes, VAT will be refunded immediately, and they will also be exempt from urban maintenance and construction tax and education fees [7] - The policy will be effective from November 1, 2025, until December 31, 2027, with applicability based on the timing of physical delivery [8] Employment Tax Deductions - Companies hiring disabled employees can enjoy a 100% wage deduction for tax purposes, provided they meet specific conditions, including signing a labor contract of at least one year and ensuring the employees are actually working [9][13] - Companies must also pay the minimum wage as approved by the provincial government and ensure that social insurance contributions are made for the disabled employees [18][22] - Wage deductions can only be claimed during the annual tax return process, not during the prepayment of corporate income tax [18][21]

Core Viewpoint - The announcement outlines new tax policies regarding gold transactions, specifically focusing on the exemption of value-added tax (VAT) for standard gold traded through designated exchanges, and the conditions under which these exemptions apply [2][3][4]. Tax Policies for Gold Transactions - Members or clients trading standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange are exempt from VAT when selling standard gold [2]. - For investment purposes, VAT will be refunded immediately upon purchase, and additional taxes such as urban maintenance and education fees will be exempted [2][3]. - If standard gold is purchased for non-investment purposes, VAT is also exempt, and a regular invoice will be issued [3][4]. Definitions and Standards - Standard gold is defined by specific purity levels (AU99.99, AU99.95, AU99.9, AU99.5) and weights (50g, 100g, 1kg, 3kg, 12.5kg) [4]. - Investment purposes include direct sales and the production of gold products with a purity of 99.5% or higher [4][5]. Invoice and Tax Calculation - The calculation of VAT for transactions involving physical delivery of gold is specified, detailing how to determine unit price, total amount, and tax amount based on actual transaction prices [5][6]. - Members must report any changes in the use of gold purchased for investment purposes to the exchange within six months [6][7]. Compliance and Record-Keeping - Members are required to maintain accurate records of gold purchases, including sales contracts and transaction details, for tax verification purposes [17][18]. - The announcement emphasizes the importance of proper invoicing and compliance with tax regulations to avoid penalties [7][9]. Implementation Timeline - The new tax policies will take effect from November 1, 2025, and will remain in force until December 31, 2027 [8][12].

Core Viewpoint - The new tax policy for gold trading, effective from November 1, 2025, aims to enhance the attractiveness of on-exchange trading, promote the standardization and centralization of gold transactions, and improve market transparency and regulatory efficiency [1][5]. Summary by Sections Tax Policy Adjustments - The announcement specifies that members or clients trading standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange will be exempt from value-added tax (VAT) when selling standard gold [3]. - For physical delivery, transactions will be categorized into "no physical delivery" and "physical delivery," with different tax treatments applied [3][4]. - Investment-use gold purchases will benefit from VAT refunds and exemptions from urban maintenance and education fees, while non-investment-use purchases will be exempt from VAT but will require different invoicing [3][4]. Market Impact - The new policy is expected to strengthen the appeal of on-exchange trading, guide the rational allocation of gold resources, and potentially shift some off-exchange trading to on-exchange, enhancing market transparency [5][6]. - Gold prices have seen significant increases, with spot gold prices reaching $4,002.69 per ounce, up over 52% year-to-date, indicating a favorable environment for the new tax policy [5]. Stakeholder Effects - The policy will impact four main groups: exchange members, institutional investors, ordinary consumers, and downstream businesses in the gold processing and retail sectors [6]. - Institutional investors may shift towards on-exchange trading to benefit from lower tax burdens, while ordinary consumers may become more discerning about purchasing channels to maximize tax advantages [6][7]. Challenges for Small Gold Merchants - Small gold merchants face structural challenges due to the new policy, including cost pressures and compliance requirements, which may lead some to exit the investment gold market [9]. - The traditional profit models of small merchants will undergo significant changes, necessitating a shift towards enhancing product value and brand differentiation to sustain profitability [9].

Core Viewpoint - The Ministry of Finance and the State Taxation Administration of China have announced new tax policies regarding gold transactions, which will exempt value-added tax (VAT) for certain transactions involving standard gold, effective from November 1, 2025, to December 31, 2027 [1][25]. Tax Policy Details - Transactions involving standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange will be exempt from VAT when sold by member units or clients [8][11]. - For physical delivery of standard gold, if member units purchase gold for investment purposes, VAT will be refunded immediately, and they will also be exempt from urban maintenance and construction tax, as well as educational fees [8][11]. - If standard gold is purchased for non-investment purposes, VAT will also be exempt, and a regular invoice will be issued [12][13]. Definitions and Conditions - "Standard gold" is defined as gold that meets specific purity and weight standards, including AU99.99, AU99.95, AU99.9, and AU99.5, with weights of 50 grams, 100 grams, 1 kilogram, 3 kilograms, and 12.5 kilograms [17]. - Investment purposes include direct sales and the production of gold products with a purity of 99.5% or higher [17][18]. - Member units must report any change in the use of standard gold before the change occurs, and they can only apply for a change once within six months of physical delivery [20]. Implementation Timeline - The new tax policies will be implemented starting November 1, 2025, and will remain in effect until December 31, 2027 [25].

Core Viewpoint - The new tax policy for gold, effective from November 1, 2025, aims to differentiate between investment gold and non-investment gold, promoting a healthier industry ecosystem and addressing previous broad management practices [3][8]. Tax Policy Changes - The announcement specifies that transactions of standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange will be exempt from value-added tax (VAT) if no physical delivery occurs. If physical delivery occurs, VAT will apply according to regulations [4][6]. - The policy categorizes gold into investment and non-investment uses, with investment uses including direct sales and production of gold bars with a purity of 99.5% or higher [8][9]. Industry Impact - Analysts believe the new policy will help curb excessive speculation in the gold market, reflecting true market demand and enhancing liquidity in the gold spot market [9][12]. - The differentiation between investment and non-investment gold is expected to lower tax burdens for gold jewelry processing and other physical enterprises, potentially encouraging more gold to flow into the real economy [9][12]. Implementation and Compliance - Industry stakeholders are awaiting more detailed implementation guidelines, with some companies already in discussions with the Shanghai Gold Exchange and tax authorities for practical applications of the new policy [10][11]. - The new regulations provide clearer definitions and calculations for invoices and deductions, which may help unify tax and accounting standards across the gold industry [12]. Market Context - As of October 31, 2023, gold prices have surged, with London spot gold and Shanghai gold prices increasing by over 52% and 50%, respectively, since the beginning of the year [12].

Core Viewpoint - The new tax policy regarding gold transactions, announced by the Ministry of Finance and the State Taxation Administration, exempts value-added tax (VAT) for members or clients trading standard gold through designated exchanges, significantly impacting dealers and their cost structures [2][3]. Summary by Categories Tax Policy Changes - The announcement specifies that when members or clients sell standard gold, they are exempt from VAT if no physical delivery occurs. If physical delivery does occur, different VAT policies apply based on the intended use of the gold [2]. - For investment purposes, the exchanges will implement a VAT refund policy while exempting urban maintenance and construction tax, with special VAT invoices issued based on actual transaction prices [2][3]. Impact on Dealers - Dealers previously benefited from VAT deductions, which have now been eliminated, leading to increased costs. The previous system allowed for a nearly zero tax burden due to the ability to provide VAT special invoices [2]. - The new policy requires that investment gold must be processed through the exchanges, with full costs subject to a 6% urban maintenance tax [2]. Specific Use Cases - For gold purchased for investment, VAT is collected and refunded, while for non-investment purposes, VAT is exempt, and ordinary invoices are issued [3][4]. - Clients purchasing standard gold will also receive ordinary invoices, and if they process or sell the gold, they must adhere to current VAT regulations [4].

Core Viewpoint - The announcement by the Ministry of Finance and the State Taxation Administration outlines new tax policies regarding gold transactions, effective from November 1, 2025, to December 31, 2027, which include exemptions and specific tax treatments for different types of gold purchases and sales [11]. Tax Policies for Gold Transactions - Members or clients trading standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange will be exempt from value-added tax (VAT) when selling standard gold [1]. - For members purchasing standard gold for investment purposes, VAT will be refunded immediately, and they will also be exempt from urban maintenance and construction tax and educational fees [1]. - If standard gold is purchased for non-investment purposes, VAT will also be exempt, and a regular invoice will be issued [2]. Definitions and Conditions - Standard gold is defined as gold that meets specific purity and weight standards, including AU99.99, AU99.95, AU99.9, AU99.5, and weights of 50 grams, 100 grams, 1 kilogram, 3 kilograms, and 12.5 kilograms [5]. - Investment purposes include direct sales and the processing of gold into products with a purity of 99.5% or higher [5]. Tax Calculation and Reporting - The calculation of VAT for members purchasing standard gold for investment purposes involves specific formulas for determining unit price, amount, and tax based on actual transaction prices [7][6]. - Members must report any changes in the use of standard gold before the change occurs, and they can only apply for a change in use once within six months of the original purchase [8][10]. Compliance and Penalties - Failure to report changes in use or to issue the correct invoices may result in penalties, including the suspension of VAT refund privileges [10]. - Serious violations, such as fraudulent tax claims, will lead to stricter penalties, including the inability to issue VAT invoices [10]. Implementation Timeline - The new tax policies will be effective from November 1, 2025, and will replace previous regulations from 2002 and 2008 [11].

Core Viewpoint - The Ministry of Finance and the State Taxation Administration announced new tax policies regarding gold transactions, effective from November 1, 2025, until December 31, 2027 [1] Group 1: Tax Exemption Policies - Members or clients trading standard gold through the Shanghai Gold Exchange and Shanghai Futures Exchange will be exempt from value-added tax (VAT) when selling standard gold [3] - For transactions without physical delivery, the exchange will exempt VAT; for transactions with physical delivery, VAT policies will apply as specified [3] - Members purchasing standard gold for investment purposes will benefit from immediate VAT refunds and exemptions from urban maintenance construction tax and education fees [3] Group 2: Taxation on Non-Investment Use - Members purchasing standard gold for non-investment purposes will also be exempt from VAT, with ordinary invoices issued based on actual transaction prices [4] - Clients purchasing standard gold will receive VAT exemptions, and ordinary invoices will be issued based on actual transaction prices [4] - If the actual use of standard gold changes after physical delivery, members must report the change to the exchange before the change occurs [4]

Core Viewpoint - The Ministry of Finance and the State Taxation Administration have issued a new announcement regarding tax policies related to gold transactions, emphasizing the tax implications for both trading members and clients when dealing with standard gold [2][3][4]. Tax Policy for Standard Gold Transactions - Taxpayers selling standard gold outside of the Shanghai Gold Exchange and Shanghai Futures Exchange are required to pay value-added tax (VAT) according to existing regulations [2]. - When trading standard gold through the exchanges, sellers are exempt from VAT if no physical delivery occurs [2]. - For transactions involving physical delivery, members purchasing standard gold for investment purposes will benefit from immediate VAT refunds, along with exemptions from urban maintenance and construction tax, and education fees [3]. - Members selling standard gold directly or processing it into investment gold products must pay VAT and issue regular invoices, not VAT special invoices [3]. - Members purchasing standard gold for non-investment purposes are exempt from VAT and must issue regular invoices [3]. - Clients purchasing standard gold through the exchanges are also exempt from VAT and must receive regular invoices [4].

Core Points - The announcement from the Ministry of Finance and the State Taxation Administration outlines tax policies regarding gold transactions, specifically exempting value-added tax (VAT) for members and clients trading standard gold through designated exchanges [1][2] - The policy includes specific provisions for both investment and non-investment uses of standard gold, detailing the VAT treatment and invoicing requirements for different types of transactions [1][2] Summary by Sections Tax Exemption for Standard Gold Transactions - Members or clients trading standard gold on the Shanghai Gold Exchange and Shanghai Futures Exchange are exempt from VAT when selling standard gold [1] - For physical delivery, VAT policies apply based on the nature of the transaction, with investment purposes receiving immediate VAT refunds and exemptions from additional taxes [1] Investment vs. Non-Investment Use - For standard gold purchased for investment purposes, VAT is refunded immediately, and additional taxes are exempted, with specific invoicing requirements for sales [1] - For non-investment purposes, VAT is also exempt, but different invoicing rules apply, allowing for VAT deductions based on specified rates [2] Implementation Timeline - The new tax policies will take effect from November 1, 2025, and will remain in force until December 31, 2027, with applicability based on the timing of physical delivery [3]