Gold Coin Tax Mechanism Outlined

EghtesadOnline: An official with Iranian National Tax Administration says those who have not sold the pre-purchased gold coins or used it for reimbursing their marriage portion liabilities will be exempt from the new gold coin tax rules.

News ID: ۷۴۷۵۱۶

11 June 2019

Elaborating on a recent INTA directive about taxing gold coins, the INTA audit deputy for Tehran Province Mohsen Ebrahimi told state radio that the tax will be levied on gold coin buyers who purchased the coins from Central Bank of Iran and later sold it.

“There is no obligation to pay tax for those who haven’t sold the coins or used them for settling their marriage portion liabilities,” IBENA quoted him as saying.

The caretaker of the Iranian National Tax Administration unveiled a plan last week to tax buyers of gold coins who   pre-purchased the coins from the CBI in the last fiscal (March 2018-19), Financial Tribune reported.

As per the INTA directive, all those who purchased up to 20 coins from the CBI are exempt from the new tax.

Those who purchased between 20-60 coins will have to pay 1.5 million rials (about $12) per coin. Owners of 60-00 coins should pay 2 million rials for each coin and those with 100-200 coins are obliged to pay 2.5 million rials.

Those with more than 200 gold coins are required to file tax returns and submit the relevant forms to the tax authority.

Asked whether the new tax could lead to trade in gold coins in secret and in underground markets, he said: “We function on the assumption that a large group of people who traded in gold coins last year didn’t pay tax…we have their names.”

The directive triggered criticism against the CBI as it had assured buyers during the presale of gold coins two years ago that the coins would be tax free.

Ebrahimi tried to shed light on the ambiguities, saying  what the CBI meant was value added tax and what is now being called for by INTA is income tax, or the so-called Capital Gains Tax, and not VAT.