HARTFORD, Conn. (May 5, 2025) – A Connecticut joint committee has passed a bill that would repeal the sales tax on gold and silver bullion.
The House Finance, Revenue and Bonding Committee filed Senate Bill 1552 (SB1552). Under the proposed law, gold bullion or silver bullion, with a purity level of at least 90 percent, palladium bullion, platinum, and gold or silver legal tender of any nation, traded according to its value as precious metal, would be exempt from the state sales tax.
The Joint Committee on Finance, Revenue and Bonding passed the amended version of SB1552 by a 52-0 vote.
The bill would also create a working group to “monitor economic conditions, inflation expectations, precious metals prices and activities, including the market activities of leading commodities exchanges and bullion market associations, and precious metals legislation proposed in or enacted by other states.”
As originally introduced, the bill would have taken other steps to promote gold and silver as money, including recognizing them as legal tender in the state. In a strategic move, the bill was simplified to increase the chances of taking the first step. An incremental approach to sound money legislation proved successful in Utah and other states.
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, states treat 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 Ron Paul said during testimony in support of an Arizona bill that repealed capital gains taxes on gold and silver in that state.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
SB1552 will move to the Senate for further consideration. It could move directly to the Senate floor or could be assigned to a Senate committee.
