ULAN BATOR, April 30 (Xinhua) -- Mongolia's central bank has bought a total of 1.6 tons of gold from legal entities and individuals since the beginning of this year, local media reported on Tuesday.
The figure is a decline of 48 percent compared with the same period last year, the daily newspaper Zasgiin Gazriin Medee quoted the Bank of Mongolia as saying.
The significant decline was directly related to the expiration of the effective period of low royalty taxes on gold with the 2014 amendments to the Minerals Law, according to the bank.
The 2.5-percent of discounted royalty on gold mining ended on Jan. 1. Since then until April 7, 5 to 10 percent royalty taxes on gold mining have been imposed on miners.
During its extraordinary session on March 18-29, the Mongolian parliament has decided to set the gold royalty at a 5-percent rate to revive the central bank's gold purchase.
"The central bank has purchased a total of 837 kg of gold since the new rate came into force on April 8. Thanks to the discounted royalty on gold, gold purchases by the Bank of Mongolia have been reviving," the central bank said in a statement.
Purchasing gold is said to be one of the key instruments for the Mongolian central bank to revive its official foreign exchange reserves.
The Bank of Mongolia purchased only 12.7 tons of gold in 2014. Thanks to the low royalty taxes on gold with the 2014 amendments, its annual gold purchase almost doubled in 2018, reaching 22 tons, according to the bank.
