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Gold service looks attractive

Many gold investors have declared government the enemy that is opposed to what they are doing.

Yet a recent announcement by the British Royal Mint makes it seem at least that the government of the United Kingdom wants to be the gold investor’s friend.

The Royal Mint has set up a website on which gold investors can buy and sell gold and have it stored for them while they own it.

It can be found at the web address The storage service is called The Vault™.

Naturally, the form of gold involved comes as coins produced by the Royal Mint, the gold sovereign, the gold Britannia and the less well known Lunar bullion coins.

Will this platform catch on?

In the United Kingdom it just might.

The government is very gold friendly.

The extent of its friendliness to gold investors might be surprising.

The Royal Mint points out that Royal Mint gold bullion coins purchased by residents of the United Kingdom are not subject to value added tax, a form of sales tax that would be applied to the purchase price.

Also, capital gains tax on profits is not applied either as the government considers the coins to be legal tender.

This is the kind of tax treatment that Americans can only dream of.

Add the convenience of not having to take delivery and insure holdings and it looks very appealing.

Of course, taking advantage of this convenience is contrary to standard American advice.

Gold is often stored by private parties who can go bankrupt or simply be dishonest.

Those worries would not seem to apply to the Royal Mint.

If the apocalypse should come, gold held custodially by the Royal Mint might not be available to individuals struggling to pay for their next meal, but that seems to be a very modest risk to accept for the convenience offered.

American gold buyers can only hope that the United States government will look across the Atlantic and copy this tax policy and this service.

All the Royal Mint needs to do now is add an online payment mechanism to these accounts and it would push bitcoin to the side of the electronic road.

Buzz blogger Dave Harper is winner of the 2014 Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper "Numismatic News."