RICHMOND, Va. (Jan. 15, 2025) – A bill filed in the Virginia House seeks to extend the state’s existing sales tax exemption on gold and silver for an additional seven years. By preserving this exemption, the measure reinforces efforts to treat gold and silver as money rather than just investment assets.
Del. Amanda Batten filed House Bill 2336 (HB2336). The Virginia legislature exempted the sale of gold, silver, and platinum bullion or legal tender coins over $1,000 from sales tax in 2018. effective until 2022. That year, the legislature extended the sunset date to 2025 and removed the $1,000 threshold. HB2336 would extend the exemption until June 30, 2032.
Sound Money Defense League Director Jp Cortez warned, “If this measure fails, and this exemption is therefore allowed to expire, Virginia citizens seeking to protect their savings against the devaluation of the dollar would be immediately harmed – not to mention an entire industry of small precious metals dealers that would be worse off.”
IMPACT
Taxes on precious metal bullion erect barriers to using gold and silver as money by raising transaction costs.
Imagine if you asked a grocery clerk to break a $5 bill and he charged you a 35-cent tax. Silly, right? After all, you were only exchanging one form of money for another. But that’s essentially what a sales tax on gold and silver bullion does. By eliminating this tax on the exchange of gold and silver, Virginia treats gold and silver specie more like money. This supports the use of gold and silver in transactions and breaks down the Fed’s monopoly on money.
“We ought not to tax money – and that’s a good idea. It makes no sense to tax money,” former U.S. Rep. Ron Paul said during testimony in support of an Arizona bill that repealed capital gains taxes on gold and silver in that state. “Paper is not money, it’s fraud,” he continued.
BACKGROUND
The United States Constitution states in Article I, Section 10, “No State shall…make any Thing but gold and silver Coin a Tender in Payment of Debts.” Currently, all debts and taxes in most states are either paid with Federal Reserve Notes (dollars) which were authorized as legal tender by Congress, or with coins issued by the U.S. Treasury – very few of which have gold or silver in them.
The Federal Reserve destroys this constitutional monetary system by creating a monopoly based on its fiat paper currency. Without the backing of gold or silver, the central bank can easily create money out of thin air.
This not only devalues your purchasing power over time; it also allows the federal government to borrow and spend far beyond what would be possible in a sound money system. Without the Fed, the U.S. government wouldn’t be able to maintain all of its unconstitutional wars and programs. The Federal Reserve is the engine that drives the most powerful government in the history of the world.
State laws that facilitate and encourage the use of sound money create a playing field where people can push back against the Fed’s monetary malfeasance. Ultimately, it could create a scenario where people can drive out the “bad” fiat money with “good” sound money.
WHAT’S NEXT
A committee referral for HB2336 is next. Once it gets an assignment, it must get a hearing and pass by a majority vote before moving forward in the legislative process.
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