Gold prices edged up in Dubai in the morning trading session on Tuesday, March 28. The price of the superior 24-carat variety of gold moved up by 1 Arab Emirates Dirham (AED) or Indian Rupee (INR) 22.38, trading at Dh 237. As per the exchange rate on Tuesday, this is equivalent to Rs 5304.06. As per Dubai’s Gold And Jewellery Group, 22-carat gold traded at Dh 219.5 per gram or Rs 4912.41.
The price of the 21-carat type stood at Dh 212.5 or Rs 4,755.75. One gram of 18-carat gold traded at Dh 182.0 per gram or Rs 4073.16. An ounce of gold was being sold at 7,185.86 or Rs 1,60,815.55, up from Monday’s level of 7,152.83 Dh.
Gold prices in UAE slipped on Monday, March 27, following cues from the international market as investors scaled back on safe-haven trading in favour of riskier assets. This was in response to the US Federal Deposit Insurance Corporation’s announcement that First Citizens Bank & Trust Co will acquire the deposits and loans of failed Silicon Valley Bank.
Dubai is a popular destination for gold buyers as the city offers a tax-free shopping experience. No taxes are imposed on raw materials such as gold bars or ingots in the City of Gold. Besides, the value-added tax for jewellery stands at just 5 per cent.
Foreign tourists can avoid paying this charge just by declaring their passports. The availability of cheap labour and a highly regulated gold market, further makes Dubai a preferred destination for gold. The market also offers a greater variety of designs and quality as compared to other parts of the world.
While buying gold from Dubai may look like an attractive option, it must be noted that the Indian government caps the amount of gold you can buy there. Exceeding the prescribed limit may result in high tax rates and other charges.
To curb gold imports, which could lead to an unfavourable balance of payments for India, the government has levied several taxes and surcharges on gold from Dubai being brought to India.
This includes a social welfare tax and additional import duties.
Social welfare tax and other import duties on the precious metal raise the cost for those who want to purchase gold from Dubai and sell it for a profit in India.
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