After the meeting of the Economic Coordination Council (ECC) held last Thursday, one of the most notable topics discussed in the statement was the mobilization of gold held under the mattress into the economy.

This issue is not new, as Türkiye has been debating it for many years. Steps have been taken numerous times, programs have been announced, and campaigns have been organized. However, the desired outcome has not been achieved, and there are very important reasons for this.

In Türkiye, the habit of physically holding gold is a very common behavior. This behavior is not only cultural but also has its roots in the beliefs of savers. Savers with a "sensitivity to interest" prefer to hold their savings in the form of physical gold and/or cash rather than depositing them in a conventional bank to earn interest. Of course, this demand, formed in this way, prevents these assets from appearing in the financial system's statistics.

It is evident that the outflow of a significant amount of physical gold and cash from the financial system has serious disadvantages. Therefore, the economic administration is making intense efforts to include these assets in the financial system. However, achieving the desired result is not easy.

The biggest obstacle to achieving the desired result is the savers with a sensitivity to interest who do not want to stay away from the conventional banking system. On the other hand, there is no significant alternative for savers who want to stay away from the system. Many savers with an interest sensitivity believe that the interest in conventional banks and the profit-sharing in participation banks are the same thing. The Presidential Finance Office, the Directorate of Religious Affairs, and Kadir Has University's annual Türkiye Trends survey have important findings in this regard.

Another instrument to which savers with an interest sensitivity direct their savings is real estate. There is intense interest in properties such as land, gardens, houses, and shops. However, these also do not appear as savings in the system, causing the ratio of total savings to gross domestic product (GDP) to remain low.

Unfortunately, the predominantly indirect tax-based structure of the tax mechanism in our country brings along the problem of the informal economy. We observe that a significant portion of individuals take their savings under the mattress to evade or avoid tax regulations and conduct part of their transactions with these assets.

As you can see, the issue is quite complex. However, there are two fundamental steps to be taken. The first is a new understanding of participation banking designed to convince individuals with an interest sensitivity. The second is to build a fairer tax system by making direct taxes more prominent, instead of indirect taxes.