China ends tax incentive on gold sales, raising costs for consumers and retailers

China has scrapped a long-standing tax incentive on gold sales in a move that could raise costs for consumers and reshape pricing dynamics in one of the world’s largest bullion markets.

Effective from November 1, China's Ministry of Finance announced that gold retailers will no longer be allowed to offset the value-added tax (VAT) when selling gold purchased from the Shanghai Gold Exchange, according to a Bloomberg report. The policy applies to all forms of gold—whether sold directly or processed into jewellery, coins, high-purity bars, or industrial materials—marking a major shift in the country’s taxation framework for the precious metal. Advertisement

The decision comes at a time when China’s economy is under pressure from weak domestic demand and slowing growth, prompting the govern