The Ukrainian parliament has passed law, which regulates gold mining by the National Bank of Ukraine (NBU) and the law on relaxation of taxation on sales of precious metals to the central bank.
Draft laws No. 9440 and 9441 were supported by 266 and 265 lawmakers respectively on Thursday.
In autumn 2011 the National Bank of Ukraine obtained property of the Northern State Geological Company Pivnichgeologiya under a government order.
The NBU said that gold reserves explored by Pivnichgeologiya are estimated at some 600 tonnes.
NBU First Deputy Chairman Yuriy Kolobov before the voting for draft law No. 9440 said that the NBU sees that its key function is to provide for guaranteed demand on gold extracted by Pivnichgeologiya.
"The NBU would not invest [in gold mining]. The government transferred the enterprise to us. The enterprise will extract and we’ll buy gold," he said.
"Exploration is not the function of the NBU. Everyone thinks that the NBU will extract itself. It is not so. The enterprise will extract and we’ll buy [gold]. No other expenses of the NBU will be seen," he said.
He said that at present, Pivnichgeologiya’s audit is being completed.
Draft law No. 9440 proposed that Article 42 of the law on the NBU should be supplemented with an item concerning the NBU’s activity connected with exploring, mining, producing and using precious metals to replenish gold and foreign currency reserves.
It was proposed to foresee that deputy NBU governors and other board members could run posts as top managers of enterprises or organizations if they fulfill functions to manage shares that belong to the state.
Bill No. 9441 said that the respective amendments to the Tax Code are necessary to create the proper legal conditions for the fulfillment of the NBU’s functions in such issues as the accumulation of gold and foreign currency reserves, issuing bonds, and minting investment coins as additional tools for investment by the public.
To create incentives for the population and buyers to selling gold and silver to the NBU, it is proposed to exempt taxes from individuals’ incomes from sales of scrap precious metals to the central bank, as well as cancel value-added tax (VAT) for operations in providing the NBU with precious metals.
Passing the proposed amendments would allow the NBU to receive gold and foreign currency reserves of about one tonne of gold per year, the authors said.
