States across the United States are ramping up efforts to promote saving in precious metals and even using gold and silver as money amid high inflation rates and geopolitical uncertainty. The push for sound money reforms has gained significant momentum, with five bills signed into law in 2023 and the influence of Money Metals’ Sound Money Defense League project growing stronger.
According to the 2024 Sound Money index published by Money Metals Exchange, a total of 25 states considered 50 pieces of legislation this year focused on various aspects of sound money policies. These measures include ending taxes on precious metals, investing reserve funds in physical gold, establishing in-state depositories, and more.
One of the key initiatives gaining traction is the movement to eliminate sales tax on the purchase of gold and silver. The majority of states have already taken this step, with Mississippi becoming the 43rd state to do so in 2023. Only seven states currently impose sales tax on precious metals, with efforts underway in five of these states to end the tax.
New Jersey, Wisconsin, Alaska, Kentucky, Maine, Vermont, and Minnesota were among the states considering legislation in 2023 to eliminate sales tax on gold and silver purchases. While progress has been made in some states, such as Alaska where the State House passed a bill seeking to end borough and city sales taxes on sound money, challenges remain in others.
In addition to ending sales tax on precious metals, some states have also focused on removing capital gains tax on gold and silver transactions. Arkansas, for example, passed House Bill 1718 in 2023, ending all remaining tax liability on such transactions. However, 39 states still tax capital gains on the sale of precious metals, prompting efforts in states like Iowa, Kansas, Missouri, and more to address this issue.
Moreover, states like Missouri, Oklahoma, and Tennessee have considered establishing in-state depositories to store gold, while North Carolina, Idaho, Tennessee, Oregon, and Florida have explored various other sound money bills aimed at protecting state reserve funds, investing in physical gold and silver, and easing regulations on precious metals dealers.
The progress made in promoting sound money policies reflects a growing recognition of the importance of precious metals in the current economic climate. With each legislative victory, states move closer to the goal of restoring sound money principles in the United States, providing a sense of optimism for the future of monetary policy in the country.
One key issue that is being discussed is the potential for a gains tax on precious metals. This could have significant implications for investors and individuals who hold gold as a form of investment or wealth preservation.
The idea of a gains tax on precious metals is a controversial topic, with some arguing that it could discourage investment in gold and other precious metals. On the other hand, proponents of such a tax argue that it would help to level the playing field and ensure that all forms of investment are subject to the same tax treatment.
As the debate continues, it will be interesting to see how policymakers and stakeholders in the precious metals market respond to the possibility of a gains tax on these assets. In the meantime, investors may want to stay informed on developments in this area to understand how their investments in precious metals may be affected.