ULAN BATOR, April 1 (Xinhua) -- Mongolia's central bank said on Monday that its purchase of gold decreased by 71.6 percent year on year in the first quarter of 2019.

The Bank of Mongolia purchased a total of 772.1 kg of gold from legal entities and individuals in the first three months of this year.

The dramatic 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 central bank.

The 2.5-percent of discounted royalty on gold mining ended on Jan. 1. Since then, 5 to 10 percent royalty taxes on gold mining have been imposed on miners.

"Miners are less willing to sell their gold to the central bank due to this factor. During its extraordinary session on March 18-29, the Mongolian parliament has decided to set the gold royalty at a five percent rate to revive the central bank's gold purchase," the bank's spokesperson Ariun Dagva told Xinhua.

She said the new rate will come into force on April 8.

The Mongolian central bank purchased only 12.7 tons of gold in 2014. Thanks to the low royalty taxes on gold with the 2014 amendments, the central bank's annual gold purchase almost doubled to 22 tons in 2018. Enditem

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