Mines Bureau: BSP gold buying down 94% as taxes turn off sellers

The gold buying activity of Bangko Sentral ng Pilipinas plunged last year as small-scale miners and traders turned to other buyers after the government imposed taxes on the transactions, the Mines and Geosciences Bureau (MGB) noted in a report released Friday.

 

The 2 percent excise tax and 5 percent creditable withholding tax imposed by the Bureau of Internal Revenue on small-scale gold miners and traders prompted the producers and dealers to sell the precious metal to buyers other than the central bank, the Mines Bureau said in the notes to its Philippine Metallic Mineral Production report.

 

The BIR move was “pursuant to Revenue Regulations No. 6-2012 dated April 2, 2012, the Mines Bureau added.

 

As a result, there was a “93 percent plunge in the documented output (value) of small-scale miners, as reflected in the purchases of the Bangko Sentral ng Pilipinas,” the Mines Bureau noted, saying this helped pull down “the overall gold production value by 44 percent.”

 

Last year, Bangko Sentral bought 1,090 kilograms of gold from small-scale miners, down 94 percent from 17,638 kgs in 2011, MGB data showed. The central bank purchases last year amounted to P2,304 billion, down 93 percent from P34,665 billion in 2011.

 

Total gold output last year reached 15,762 kgs, valued at P35.132 billion. The volume was down 49 percent from 31,120 kgs in 2011, and the value was down 44 percent from P63.142 billion, MGB data showed. — VS, GMA News