LAOPU GOLD (06181) experienced a significant plunge during the trading session, with its stock price plummeting by 9.13%. The sharp decline comes amid news of a new gold tax policy implemented by Chinese authorities, which aims to reduce speculative behavior in the gold market.

On November 1, China's Ministry of Finance and the State Taxation Administration jointly announced new tax policies related to gold. According to Guosen Securities, the policy specifies the intended use of gold raw materials and implements differentiated tax management. This move is expected to standardize operations within the industry and foster healthier competition while potentially curbing speculative activities that have been prevalent in the gold market.

The impact of this new policy is already being felt across the gold industry. CITIC Securities Research suggests that end consumers may see an increase in gold jewelry prices, although the extent of the price hike will depend on how much of the cost is passed through by gold jewelry manufacturers. Interestingly, purchases of gold bars from Shanghai Gold Exchange member units may remain unaffected by these changes. As investors digest the implications of this new policy, it appears to have triggered a sell-off in gold-related stocks, with LAOPU GOLD being particularly hard hit.