ULAN BATOR, Oct. 2 (Xinhua) -- Mongolia's central bank bought 11.2 tons of gold from legal entities and individuals in the first nine months of this year, down by 22 percent year-on-year.
The decline was mainly related to the expiration of the effective period of low royalty taxes on gold with the 2014 amendments to the Minerals Law, the Bank of Mongolia said in a statement on Wednesday.
The 2.5 percent of discounted royalty on gold mining ended on Jan. 1, after which 5 to 10 percent royalty taxes on gold mining were imposed on miners, resulting in the decrease of the central bank's gold purchase by 71.6 percent year-on-year in the January-March period.
To revive the central bank's gold purchases, the country's parliament has set the gold royalty at a 5-percent rate.
The central bank's gold purchase has been continuously increasing since the discounted royalty on gold mining came into force on April 8.
It is expected that the gold purchase will increase in October, one of the peak months of gold mining.
Purchasing gold is said to be one of the key ways for the mineral-rich Asian country's central bank to increase its official foreign exchange reserves.
The country's foreign exchange reserves reached 4 billion U.S. dollars at the end of July. The Bank of Mongolia aims to increase the reserves to at least 6.5 billion dollars in the medium term.
