The purity and quality of gold is something buyers are always apprehensive of. There are different types of gold that buyers can choose from. Buyers often have a tough time distinguishing between the Hallmark gold and the KDM gold.
1) Hallmark Gold: Hallmark gold is the type of gold upon which, tests are conducted at assaying centers and is approved for sale by the Bureau of Indian Standards (BIS). Hallmark gold is available in four varieties being 23 Karat, 22 Karat, 21 Karat, and 18 Karat.
2) KDM Gold: KDM gold is a type of gold made combining 8% cadmium with 92% gold. Not only does this tamper with the purity of gold, but it also has certain health risks associated with it because of which the production of this gold has been terminated.
GST or Goods and Services Tax came into effect on 1st July 2017 by subsuming the repetitive tax structure of the previous regime and bringing transparency and accountability in the taxation system.
The implementation of this new tax regime has left a considerable effect on the prices of several commodities, of which gold accrues enormous importance due to its national and international demand.
Under the new tax regime, the GST on gold was fixed at 3% with an additional 8% tax on the making charges and import duty of 10%. Later, the making charges tax was revised and reduced to 5%. As a whole, the yellow metal has become expensive by 0.75% in the post-GST era.
A primary reason that accounts for the rising gold price is 10% import duty. However, traders have managed to evade that by importing gold from countries like South Korea, with which India shares the Free Trade Agreement.
Indians have traditionally used gold for investment purposes. Gold is considered a hedge against financial disruptions. However, when you want to sell gold for meeting urgent financial needs, you should be aware of how old gold jewellery is valued. The right knowledge would keep you safe against unscrupulous jewellers. To calculate the value of gold, you have to take it to the nearest assaying or testing laboratory and get its weight and purity tested. The centre certifies gold's purity in Karat or percentage. To calculate the value of the old gold jewellery by the Karat purity method, you have to multiply the gold's weight, purity, and gold rate and divide it by 24. To calculate the value of the old gold jewellery by the percentage purity method, you have to multiply the gold's weight, purity, and gold rate and divide it by 100.
Gold derives this value from several factors, some of which are listed below:
Gold, in its elemental form, is a relatively hefty atom. Although it is not the rarest of metals, it isn’t easy to find and extract gold in large quantities. This contributes to its high perceived value.
Gold is a highly coveted metal in a county like India. So, it generally enjoys a high demand all year round, but its supply falls short to meet that. As a result, gold prices tend to increase with time.
One of gold’s many attractive aspects is its liquidity. Gold has an active, reliable and a ready market of buyers at almost all times. As a result, it can be readily converted to cash, which makes it a highly liquid asset.
It is universally accepted as a commodity of value, especially under a free market system. Gold reserves ensure the strength and stability of the currency and eliminate the pitfalls of fiat money.
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