Amendment in Gold Monetisation Scheme

modifications in Gold Monetization Scheme

Question: When did the government launched Gold Monetisation Scheme?

(a) 5 November 2015
(b) 22 October 2015
(c) 22 January 2015
(d) 11 October 2015

Ans (a)

Related facts:

  • On 21 January 2016, The Reserve Bank of India has made a few amendments to its Master Direction on Gold Monetization Scheme. The modifications have been made in consultation with Central Government to make the Scheme more customer-friendly.
  • The gold monetization scheme was launched by Government on November 5, 2015. Changes in the plan are:
  • Premature redemption under Medium and Long Term Government Deposits (MLTGD), Any Medium Term (5-7 Years) Deposit will be allowed to be withdrawn after 3 years and any Long Term (12-15 Years) Deposit after 5 years.
  • Gold depositors can also give their gold directly to the refiner rather than only through the Collection and Purity Testing Centers (CPTCs). This will encourage the bulk depositors including Institutions to participate in the scheme.
  • The banks would get a 2.5 % commission for the scheme which will include the charges payable to the Collection and Purity Testing Centers/Refiners.
  • Bureau of Indian Standards (BIS) has modified the licensing condition for refiners already having National Accreditation Board for Testing and Calibration Laboratories (NABL) accreditation.
  • From the existing three years refining experience it has been reduced to one year refining experience. This is likely to increase the number of licensed refiners.
  • BIS has published an Expression of Interest (EOI) on its website inviting applications from the more than 13,000 licensed jewelers to act as a CPTC in the scheme.
  • The quantity of gold collected under the scheme will be expressed up to three decimals of a gram. This will give the consumer better value for the gold deposited.
  • Banks are free to hedge their positions in the case of short-term (1-3 years) deposits.
  • Gold to be deposited with the CPTCs/Refineries can be of any purity. The CPTC/Refiner will test the gold and determine its purity which will be basis on which the deposit certificate will be issued.
  • Indian Banks Association (IBA) will communicate the list of the BIS licensed CPTCs and refiners to the banks.
  • Government has also launched the dedicated website www.finmin.nic.in/swarnabharat and toll free number 18001800000, which provide all the information of the schemes.
  • It is again clarified that Tax exemptions under the GMS include exemption of interest earned on the gold deposited and exemption from capital gains made through trading or at redemption.
  • It is also reiterated that as per CBDT instructions No. 1916 dated 11th May, 1994, in course of IT Search u/s 132, gold jewellery to the extent of 500 gms per married lady, 250 gms per unmarried lady and 100 gms per male member of the family, need not be seized by tax authorities.
  • Till January 20, 2016 the government has already mobilized 900.087 kg of gold through the gold monetization plan.
  • The Gold Monetization Scheme intended to mobilise 20000 tones of gold held by households and institutions of the country and facilitate its use for productive purposes, and in the long run, to reduce country’s reliance on the import of gold.

Reference:

https://www.rbi.org.in/Scripts/BS_PressReleaseDisplay.aspx?prid=36041

https://rbi.org.in/Scripts/NotificationUser.aspx?Id=10240&Mode=0