China's new gold tax policy, effective November 1, has led to a significant decline in gold jewelry and mining stocks. The policy, announced by the Ministry of Finance and the State Taxation Administration, introduces differentiated tax management for investment and non-investment gold transactions. As a result, shares of Chaohongji plummeted 9.9%, while Zhou Dashing and Laofengxiang saw declines of over 3%. In Hong Kong, Chow Tai Fook's shares fell 8.67%.
The market's reaction is attributed to concerns over increased operational costs for retail gold jewelry firms, as non-investment gold products are now subject to VAT. While upstream gold mining companies like Zijin Gold and Zhaojin Mining reported no impact, downstream retailers such as Chaohongji and Caibai are evaluating the policy's effects. Additionally, banks like ICBC and CCB have temporarily suspended certain gold accumulation services.
China's Gold Tax Policy Triggers Sharp Decline in Jewelry Stocks
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