MAS launches gold vaulting service with 500-tonne capacity, extends GST waiver to some gold services

SINGAPORE: The Monetary Authority of Singapore (MAS) on Tuesday (Nov 10) launched its gold vaulting service for central banks with capacity to store up to 500 tonnes of gold.

MAS and the Ministry of Finance also said they would introduce an enhanced Goods and Services Tax (GST) framework, to waive taxes on some wholesale services related to investment precious metals.

For example, GST will not be charged on services between institutional participants, such as vaulting, refining, recasting, assaying and broking.

"This will better reflect the fact that the gold is predominantly traded among institutional participants and is not for domestic consumption," MAS chairman Gan Kim Yong told reporters, adding that more details would be shared at Budget 2027.

MAS said the framework is expected to take effect from April next year.

The gold vaulting service aims to provide foreign central banks, international financial institutions and sovereign entities with a secure option to hold gold reserves in Singapore. 

Its launch comes after MAS said it would develop measures to strengthen Singapore's gold ecosystem as interest grows.

On Tuesday, Mr Gan, who is also Singapore's deputy prime minister, said demand for gold is rising given the increasingly uncertain external environment, and investors and central banks are looking for resilience and diversification.

"Singapore does not aim to replace other gold centres and gold vaulting services," he said. "We are an additional option that is offered to the central banks."

Central banks are looking for alternatives and more options to strengthen resilience, so Singapore's services could meet that demand, he said, though he declined to share confidential details about entities that have expressed interest in storing gold here.

Singapore has strong credibility among financial institutions and central banks, and is in a strong position to serve this need, he added.

MAS said the gold will be stored in Singapore's national currency vault, which can store up to 500 tonnes, with room to expand as demand grows.

The Singapore Exchange and six banks are also working together to complete preparations for the Over-the-Counter gold clearing system by the end of this year.

Live trading and market operations are expected to start in the first quarter of next year.

Mr Gan said developing Singapore's gold market is a natural extension to the city-state's role as a trusted financial centre.

Secure storage will be connected with trading and settlement, so that gold can be held, managed and traded in Singapore.

The move will anchor new high-value activities across trading, risk management, custody and professional services, said Mr Gan.

"It will create good jobs and capabilities while adding depth and resilience to our financial sector, strengthening Singapore's role as a trusted connector between Asia and global gold markets," he said.