Starting January 1, 2018, all gold jewelry purchases will be assigned a 5% VAT in the UAE, possibly prompting, according to reports quoted in Rough & Polished, a “gold rush” in Dubai between early December 26 and late December 31.
The new 5% VAT will be imposed on all gold jewelry purchases, while there is 0% rate on 24-carat gold in the form of bars. According to sources, a 30% decline in gold jewelry demand is likely for the first three to six months of 2018, but “it should improve after that”.
Earlier this week, Praveen Shankar Pandya, Chairman of the Gem & Jewellery Export Promotion Council (GJEPC), said that the tax will hurt gold jewelry exports from India as the UAE is one of the major buyers of Indian jewelry.
