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Gold sellers paying less tax than they should—BIR

/ 03:16 AM November 14, 2012

BIR Commissioner Kim Jacinto-Henares. INQUIRER FILE PHOTO

Gold sellers are actually paying less taxes than they should, according to chief revenue commissioner Kim Henares.

They should be paying 34 percent, or almost five times more than the 7 percent tax on gold sales that some lawmakers want suspended, she said.

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“Based on the (Tax Code), if your income is more than P500,000, the tax is 32 percent,” Henares said.

Those selling gold to the central bank exceed that income level, Henares said.

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Politicians and some government officials believe that the gold tax which the Bureau of Internal Revenue (BIR) imposed last year was the cause of the rampant smuggling of the precious metal out of the country.

Environment Secretary Ramon Paje has estimated the drop in gold sales to the Bangko Sentral ng Pilipinas (BSP) at 80 percent but would not say if it was due to the gold tax.

An average of 30 tons of gold is sold annually to the BSP, Mines and Geosciences Bureau director Leo Jasareno said earlier.

But last year, only 5 tons were sold to the central bank, and large-scale mining firms accounted for most of it, he said.

It is assumed that the rest of the gold produced in the country were sold by small-scale miners in the underground market, he said.

Some lawmakers have asked the BIR to suspend the tax on gold, saying that this was encouraging the boom in the black market sale of the metal.

“If that is the case, the issue is not taxation, it is law enforcement,” Henares retorted.

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She said that the BIR was currently collecting just a 5-percent creditable withholding tax on top of the 2-percent excise tax on gold sales.

“They are actually paying less (than they should), so what is this complaining about?” Henares said.

The BIR has brought a complaint of tax evasion against a Cebu City-based gold trader for allegedly failing to file quarterly and annual income tax returns 2005, 2006, 2007, 2008 and 2009.

Citing records from the central bank, the BIR said the accused, Junrie Daitol Tenorio, sold gold to BSP worth P3.95 billion during the five-year period.

Not only did Tenorio fail to file the required tax returns, he also did not pay the income taxes due on the five taxable years, the BIR said.

The BIR wants the trader to pay a total of P2.67 billion in back taxes for those five years, including surcharges and interest.

Originally posted: 8:16 pm | Tuesday, November 13th, 2012

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TAGS: Bangko Sentral ng Pilipinas, BIR, BIR commissioner, Bureau of Internal Revenue, Business, Global Nation, gold, gold smuggling, Gold Tax, gold taxes, Kim Henares, metals, state budget and taxes
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