SMDL Policy Director Jp Cortez Testifies Before TN Committee on Sound Money Measure

The state of Tennessee has thought-about sound cash laws in every of the final seven years. Championed by Rep. Bud Hulsey, HB 1874 would lastly take away the gross sales tax on gold and silver cash and bullion presently levied within the Volunteer State.

At a listening to yesterday in Nashville, Jp Cortez, coverage director of the Sound Cash Protection League, testified on behalf of sound cash advocates and treasured metals buyers throughout the state, in assist of HB 1874.

Written testimony (barely totally different from spoken testimony) is beneath:

Chairman Hicks, members of the Finance, Methods, and Means Home Subcommittee, thanks for the chance to testify earlier than you as we speak.

My title is Jp Cortez and I’m the coverage director for the Sound Cash Protection League. I ask you to please vote YES on Home Invoice 1874, a measure that removes gross sales taxation from gold and silver cash and bullion.

Simply two months in the past the Tennessee Advisory Fee on Intergovernmental Relations launched a report on the feasibility of making a state gold depository.

Whereas the report concluded {that a} bullion depository wouldn’t be possible in Tennessee at the moment, TACIR pointedly concluded that the state ought to contemplate a gross sales tax exemption from treasured metals cash and bullion.

There’s a nationwide pattern to take away gross sales taxation from treasured metals. In accordance with TACIR’s report, 42 states have already achieved so in entire or partly. Mississippi, Hawaii, Kentucky, and New Jersey are anticipated to contemplate measures to take away gross sales taxation from treasured metals within the upcoming weeks.

Tennessee has thought-about measures much like Home Invoice 1874 for seven years. Whereas it has failed to date to cross this frequent sense measure, six different states have ended the observe of taxing treasured metals over the identical period of time. (WV, OH, LA, NC, KS, AR)

Beneath present legislation, Tennessee residents are discouraged from insuring their financial savings in opposition to the devaluation of the greenback as a result of they’re penalized with taxation for doing so. Home Invoice 1874 removes the disincentives to holding gold and silver for this goal. Listed here are just a few explanation why I strongly urge you to vote YES on Home Invoice 1874:

-Taxing gold and silver is a de facto funding penalty on Tennessee residents (often of humble means) who search to carry a few of their financial savings in actual belongings which can be insulated from inflation and monetary turmoil. It’s additionally discriminatory, as a result of purchases of shares, bonds, mutual funds, ETFs, actual property, and each different monetary instrument aren’t topic to gross sales tax.

From the TACIR Report:  “Anybody shopping for and storing treasured metals in Tennessee owes Tennessee’s gross sales tax, and state and native charges mixed may be as excessive as 9.75%”

-Purchasers of treasured metals aren’t “consuming” them, making a gross sales tax and/or use tax inappropriate within the first place. Treasured metals purchasers are holding these metals for resale or change, like a foreign money or funding.

The change of 1 greenback for 4 quarters is a nontaxable occasion. Exchanging {dollars} for the one type of cash talked about within the U.S. Structure shouldn’t be taxed.

Taxing the acquisition of financial metals additionally undermines Tennessee companies (and scale back Tennessee state revenues). Many Tennesseans will purchase and/or retailer their treasured metals in close by Alabama, Georgia, Missouri, North Carolina, and Virginia, which don’t cost gross sales tax on treasured metals. 

Research have proven that states really lose income after they tax the acquisition of gold and silver. Washington and Nebraska thought-about repealing longstanding exemptions on treasured metals of their states however legislators realized the most important coverage error this may entail and the measure didn’t make it out of committee in both state.

Louisiana and Ohio each briefly imposed a gross sales tax on treasured metals not too long ago – however the legislatures in each states shortly reversed course after one 12 months when companies, coin conventions, and state revenues left the state.

That’s why any income collected from treasured metals gross sales taxes would nearly definitely be surpassed by the tax income misplaced from coin conventions, companies, and different financial exercise leaving the state.

By voting sure on Home Invoice 1874, you can be following an instance set by 42 different states which have already decreased or eradicated gross sales taxes on treasured metals, honoring the one type of cash talked about within the U.S. Structure, and decreasing the tax burden in your constituents.


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