The government on Thursday announced that gold or jewellery bought using funds from disclosed income, exempted income or “reasonable household savings” will not be taxed. The Ministry of Finance said the tax exemption is also applicable to inherited gold or jewellery.

The Centre’s announcement follows speculation that taxation laws will be amended to include increased taxes on gold or jewellery possessions – the rumours grew after it was reported that people were converting their black money into gold, The Financial Express reported. The Ministry of Finance, on Twitter, said, “Apprehension that jewellery with households, acquired out of disclosed sources or exempted income shall become taxable, is unfounded and baseless.”

The statement said there will be no seizure of gold jewellery up to 500 g owned by a married woman, 250 g owned by an unmarried woman and 100 g owned by a male during an income tax search.

On November 8, Prime Minister Modi had announced that Rs 500 and Rs 1,000 notes will not be legal tender anymore. He said it was a step to fight black money, corruption and the circulation of counterfeit currency in the country.