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“No changes in prices of gold jewelry for now,” UAE retailers say

A retailer has clarified that shoppers will not feel any immediate impact on prices of jewelry even after the UAE Cabinet has announced the country will adopt a law exempting gold and diamond trading from value-added taxes or VAT.

“The announcement will not have any direct impact on the retail consumer. There is no tangible benefit for shoppers on account of this,” Joy Alukkas, chairman of a jewelry network in the UAE said in a Gulf News report.

“I feel in the long run if the VAT privilege on wholesale transactions gets extended to other categories in the jewellery industry, consumers will stand to benefit,” he added.

Last week, the UAE Cabinet has introduced a tax mechanism that will exempt investors of gold, diamond and other precious metals from Value Added Tax (VAT).

With the new system, the five percent VAT in gold and diamond, among others, will only be documented in the seller’s records. The VAT, however, will not be paid by the investor, reported WAM.

The new law is applicable for different precious metals including gold, silver, and platinum with a purity of 99 percent or more used in trade in accordance with internationally accepted standards.

The announcement triggered an influx of consumers eager to know if there would be changes in the prices of jewelry.

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