Article Image

IPFS News Link • Precious Metals

Four States Consider Lifting Taxes On Precious Metals

•, Via

Earlier this month, all four states introduced or reintroduced bills that would exempt precious metals from either state sales tax (in Kentucky and Wisconsin) or state income tax (in Georgia and Kansas).

Kentucky lawmakers will vote on House Bill 101 and Senate Bill 105 in this year's legislative session. If passed, the bills would end state sales tax on gold, silver, platinum, and palladium bullion starting in August of this year. Wisconsin's Assembly Bill 29 and Senate Bill 33 would both enact similar provisions while also lifting sales tax on the purchase of copper bullion.

Proponents of these bills point out that gold and silver are one of the only asset classes that have sales taxes; investors don't have to pay sales tax on more common investments, like stocks and bonds. The Sound Money Defense League recently elaborated on this point:

"Sales taxes are typically levied on final consumer goods. Computers, shirts, and shoes carry sales taxes because the consumer is 'consuming' the good. Precious metals are inherently held for resale, not 'consumption,' making the imposition of sales taxes on precious metals illogical from the start."

Both Kansas and Georgia eliminated sales taxes on bullion in the past and are now taking the next logical step in facilitating the use of sound money. House Bill 895 in Georgia and House Bill 2405 and Senate Bill 303 in Kansas would lift state capital gains taxes on precious metals, leaving only the federal capital gains tax on income earned from holding gold or silver.

Kansas' two bills also explicitly reaffirm that gold and silver are legal tender in the state and ensure physical metal can be used voluntarily as currency, establishing a relatively free market in money:

"The purchase, sale or exchange of any type or form of specie shall not give rise to any tax liability of any kind… Unless expressly provided by statute or by contract, no person shall have the right to compel any other person to tender specie or to accept specie as tender."