Revenue Secretary Assures Return For SGB Holders, See How Much Your Bond Will Yield On Maturity
This return will be inclusive of interest and stands despite the Union Budget 2024 announcing a reduction in customs duties on gold and silver to 6 per cent each
Revenue Secretary Sanjay Malhotra on Tuesday assured the common man that the sovereign gold bonds will yield at least 12 per cent overall return for the investors. This return will be inclusive of interest and stands despite the Union Budget 2024 announcing a reduction in customs duties on gold and silver to 6 per cent each.
Earlier, the customs duties on the metals stood at 15 per cent each, reported Moneycontrol. Addressing the post-Budget session at the PHD Chamber of Commerce and Industry, the official said, “I want to assure that despite the rate reduction in gold import duty, the sovereign gold bonds nearing final redemption will still get at least 12 percent total return, if not 12.7-12.8 percent. Even 12 percent return is not low.”
The official explained that the import duty on gold was raised earlier in July 2022 in an attempt to manage the worsening current account deficit (CAD) and keep a tab on imports. However, Malhotra noted, that now the country remains in a comfortable position in terms of current account deficit.
The SGB 2016-17 series 1 was issued in August 2016 and investors who participated in it will now be eligible for the final redemption in the first week of August 2024. The original price of the series stood at Rs 3,119, along with an annual interest rate of 2.75 per cent.
Notably, the investors so far enjoyed a return of nearly 9-11 per cent per annum, along with an interest rate of 2.5 per cent, the report stated citing a senior government official.
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The redemption price of the gold bonds is decided using the average closing price of 999 purity gold published by the India Bullion and Jewellers Association Ltd. The price given by the association for three business days ahead of the redemption date is taken into consideration. Investors receive the interest once in every six months.
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