THE Bangko Sentral ng Pilipinas (BSP) would not be pushed into collecting the excise tax on thousands of small-scale gold miners around the country as this would immediately dry up a lucrative source of the precious metal that has helped strengthen the country’s external sector in recent years.

To collect the 2-percent excise tax on gold and withhold a portion of miners’ income from the sale were recently imposed on the BSP by the Bureau of Internal Revenue (BIR).

Deputy BSP Governor Diwa Guinigundo rejected the thought the BIR would think of transforming their regional gold-buying stations into tax-collection points.

“We have questioned its legality. We fear if we begin collecting the tax from the small-scale miners, they would simply take their gold elsewhere, and we do not want that to happen,” Guinigundo said.

At stake are the estimated 400,000 troy ounces of gold the central bank buys each year from the thousands of small-scale gold miners, the bulk of which comes from miners who often get cheated by private gold buyers and their “intelligent” weighing scales.

BIR chief Lilian Hefti has directed the BSP to “act as tax-collection agent.” In that role, it was expected to impose the 2-percent excise tax on the metal it buys from miners and withhold a portion of the sales proceed.

The excise and withholding taxes were to apply on each sale transaction that generate up to 300,000 troy ounces, or 60 percent, of all gold purchased each year through BSP buying stations, Guinigundo said.

The BSP is able to generate volume through its busying stations because of a tacit understanding that the sellers would remain anonymous.                                                                                                     

“If we now create a paper trail for these people, this would force them to bring their gold elsewhere, quite possibly to the country’s backdoor or to the blackmarket,” Guinigundo said.

He said the BSP buying stations are simply better that others because they employ professional assayers, use accurate scales and, most especially transactions are done “without any questions asked.”

Gold bought by the government must be mercury-free and the quality or purity must meet the BSP standard, Gunigundo said.

This arrangement—that the BIR has proposed to derail—has allowed the Philippines to rank fourth or fifth largest gold producer in the world, according to Guinigundo.

He also said the country’s gold holdings account for roughly 10 percent of the gross international reserves, or $3 billion.

REVENUE inflows in April reached a sufficient amount that Manila was able post a budget surplus of P25.8 billion.

THE peso yesterday closed unchanged in thin trading because of holidays in some Asian countries and persistent worries on inflation and crude prices, currency dealers said.

BANCO de Oro Unibank Inc. (BDO) sold P10 billion worth of unsecured subordinated debt eligible as Lower Tier 2 Capital, twice the amount of the original issuance announced last week.

BEFORE the cash register stops ringing, you may want to add home insurance to go with that carton of milk or can of spaghetti sauce.

THE Bangko Sentral ng Pilipinas (BSP) would not be pushed into collecting the excise tax on thousands of small-scale gold miners around the country as this would immediately dry up a lucrative source of the precious metal that has helped strengthen the country’s external sector in recent years.