Landmark legislation, which went into effect Tuesday in Texas, completely eliminates all taxation of precious metals on the grounds that gold and silver can be considered a currency.
Author: Dorothy Kosich
Posted: Wednesday , 02 Oct 2013
As of October 1, the sales tax levied on purchases of gold, silver and platinum bullion and numismatic coins in Texas is now eliminated. It is the first time that a state has expanded an existing sales tax exemption for gold and silver.
Previously, Texans were paying 6.25% on all precious metals purchases under $1,000, a tax that was considered especially burdensome to small investors. Gov. Rick Perry signed H.B. 78 into law on June 14.
The legislation puts precious metals on a level playing field with other investments. Proponents of the legislation had asserted the exemption would attract coin shows, auctions and other events to Texas.
It also gives precious metals consumers an incentive to do business with Texas dealers, rather than order from out-of-state dealers over the internet.
The American Principles Project, along with the American Open Currency Standard, were major advocates for the legislation based on the principle that gold and silver are money and, therefore, should not be taxed. “Hard currencies have intrinsic value,” asserts AOCS’s website. “Even in the unlikely event that everyone else stops using the currency, the merchant is left with coins made of silver or gold. Failure is much less likely with a hard currency to begin with. Most paper currencies fail due to inflation and the crisis in confidence that accompanies it. Hard currencies today are virtually inflation-proof.”
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