Dubai has truly earned the title of City of Gold across the Globe. Gold trading is a very attractive and profitable business in Dubai. The industry of gold adds about 20% to the total GDP of the United Arab Emirates, where Dubai contributes the lion’s share already. If someone wants to start a gold business then there are several advantages of setting up a gold business in Dubai. There are over 4,000 businesses involved in the bustling gold sector, uncountable specialists are directly engaged in many trades. There are hundreds of foreign and local investors in the UAE’s gold industry. Below we present a little guide about the delightful benefits of starting a gold business in Dubai or the UAE.
Gold is regarded as a necessary asset around the world, regardless of the country of origin and culture, and people invest heavily in it. They believe that the money converted into gold would be secure and safe. This is available in multiple forms like bars, coins, blocks, jewelry, and bullions. The different kinds of carats are available for business – 18k, 21k, 22k, and 24k. A variety of various things require to be considered when retailing gold, such as the gold weight, quality control, the cost of craftsmanship, where relevant the cost of waste, and vat TAX.
Prospects of Setting up a Gold Business in Dubai
Overseas investors and entrepreneurs wishing to start a business in a golden district can try in the sectors are:
- Sourcing and Trading
Dubai and the entire UAE surprisingly have no gold mines of their own. Most of the gold utilized here comes from the African, Latin American, and East African nations. Companies included in gold mining have started the practice of responsible sourcing that restricts the sourcing of the metal from war-torn and politically unstable regions which are rumored to finance illegal activities.
MCC AND DGCG free zone – dedicated to empowering the community of gold – SMEs, and corporations have easily adopted the ethical sourcing policy of their free will without having to force the government to do so. Maximum businesses are voluntarily signing up for the certification that certifies that utilized bullions are sourced responsibly and ethically without harming any local people and the atmosphere. Gold forms a major part of goods shipped to the United Arab Emirates, accounting for about 14% of the overall imports in 2018.
There are several business and investment possibilities available in the gold manufacturing and refining business. in addition, several companies are included in the gold-crafting procedure. This includes both international and local companies that source gold either on their own or from various traders conducting in Dubai. companies deploy all the latest technologies to enhance their capabilities and enhance procedure efficiency. The manufactured and refined gold would move through the supply chain, which involves several wholesalers, distributors, suppliers, and retailers of gold.
- Financing and Investing
Gold is a very notable investment instrument around the world. Although, most gold is sold in its basic form, over the years there have been many opportunities to invest in the electronics and home appliances industry by implementing fail-safe means. The Dubai Multi Commodities Center free zone has been grown by the government of Dubai to give market infrastructure for global commodities trading, especially gold and its derivatives.
Perks of Setting up a Gold Business in Dubai
Setting up a Gold Business in Dubai : A variety of advantages of market and government support to businesses investing in Dubai’s gold industry.
- VAT on Gold Trading
Dubai is a well-known and trusted market for gold investments. Tourists, entrepreneurs, visitors, immigrants, and local nationals never miss an excuse to get the precious yellow metal. Gold ornaments and jewelry are available at relatively affordable prices in Dubai. A VAT exchange mechanism exists – as per the registered and listed dealers don’t collect any VAT when selling gold to another registered dealer unless the latter schemes to manufacture or resell those products. Nevertheless, VAT is still levied at a reduced rate of 5% of the total estimated value of gold purchased from retail customers.
- Business Locations
Corporations may decide to either begin a business in a free zone dedicated to the gold business in Dubai or set up a business in Dubai mainland. Profits vary between the free zones depending on where the market is going. DMCC provides a host of facilities to the gold sector that includes – tax exemption on exports and imports, 100% repatriation of earned profits and invested funds, no tax on personal and corporate income, hallmarking, giving protection, and shuttle transport for consumers.
Also read, Guide to Business Culture in UAE