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Wednesday, May 29, 2024

SIGNED INTO LAW: Wisconsin Formally Ends Sales Taxes on Gold and Silver

(Jp Cortez, Sound Money Defense League, Money Metals News Service) Responding to an overwhelming groundswell of grassroots pressure, Gov. Tony Evers today signed a bill into law that secures Wisconsin’s place as the 44th state in America to end sales taxes on the purchase of precious metals.

Wisconsin Flag

Assembly Bill 29 and Senate Bill 33, carried by Rep. Sortwell and Sen. Stroebel, respectively, enjoyed strong bipartisan support in both chambers of the Wisconsin legislature before it landed on Gov. Evers’ desk.

Backed by the Sound Money Defense League, Money Metals Exchange, and in-state Wisconsin dealers and investors, the legislative effort built upon last year’s educational campaign.

In 2023, similar bills had been introduced in Madison but failed to receive a hearing.

The new statewide sales tax exemption on bullion coins, bars, or rounds (minted of gold or silver, but also platinum, palladium, or copper) takes formal effect on Saturday, March 23rd.

“As inflation ravages American families, Wisconsin has taken an important step toward remonetizing gold and silver, a proven inflation hedge and the only form of money mentioned in the U.S. Constitution,” said Jp Cortez, executive director of the Sound Money Defense League.

Every one of Wisconsin’s neighbors (Iowa, Illinois, Minnesota, Michigan) had already stopped taxing the monetary metals – a situation that placed additional pressure on the Badger State.

Precious Metals Sales Tax

Meanwhile, other states have been repealing this sales tax in recent years: Mississippi in 2023, Tennessee in 2022, and Arkansas and Ohio in 2021.

Other states may yet pass similar exemptions this year.

In response to Gov. Evers signing the bill into law today, Sen. Stroebel said, “I am proud to have played a leading role in the effort to finally add Wisconsin to the long list of [tax-exempt] states. Unlike other common financial instruments, gold and silver are explicitly identified as money in the U.S. Constitution.”

He continued, “The signing of AB 29 removes a key barrier for Wisconsinites seeking to build and protect their wealth and puts gold and silver on an equal footing with other types of investment vehicles.”

Until now, Wisconsin citizens have been discouraged from protecting their savings against the devaluation of the dollar because they were penalized with sales taxation for doing so.

Eliminating sales taxes on the monetary metals is good public policy for many reasons:

  • Levying sales taxes on precious metals is inappropriate. Sales taxes are typically levied on final consumer goods. Computers, shirts, and shoes carry sales taxes because the consumer is “consuming” the good. Precious metals are inherently held for resale, not “consumption,” making the application of sales taxes on precious metals inappropriate. 
  • Studies have shown that taxing precious metals is an inefficient form of revenue collection. The results of one study involving Michigan show that any sales tax proceeds a state collects on precious metals are likely surpassed by the state revenue lost from conventions, businesses, and economic activity that are driven out of the state. 
  • Taxing gold and silver harms in-state businesses. It’s a competitive marketplace, so buyers will take their business to neighboring states, thereby undermining in-state jobs. Investors can easily avoid paying $120 in sales taxes, for example, on a $2,200 purchase of a one-ounce gold bar. 
  • Taxing precious metals is unfair to certain savers and investors. Gold and silver are held as forms of savings and investment. Wisconsin already does not tax the purchase of stocks, bonds, ETFs, currencies, and other financial instruments. 
  • Taxing precious metals is harmful to citizens attempting to protect their assets. Purchasers of precious metals aren’t fat-cat investors. Most who buy precious metals do so in small increments as a way of saving money. Precious metals investors are purchasing precious metals as a way to preserve their wealth against the damages of inflation. Inflation harms the poorest among us, including pensioners, Wisconsinites on fixed incomes, wage earners, savers, and more.

“With the signing of AB 29, only six states in the entire country still levy this ridiculous tax on precious metals,” said Stefan Gleason, president of Money Metals and Chairman of the Sound Money Defense League.

He continued, “We will continue fighting for our precious metals customers in every state that still fully taxes gold and silver purchases, specifically New Jersey, Maine, Kentucky, Vermont, Hawaii, and New Mexico.”

Similar bills are moving forward rapidly right now in Kentucky and New Jersey. Within a few weeks, it’s possible Kentucky and New Jersey could become the 45th and 46th states to enact this particular reform.

More than a dozen other states have introduced pro-sound money legislation in 2024 so far, including Alaska, Indiana, Iowa, Georgia, Kansas, Kentucky, Missouri, Idaho, Arizona, Utah, New Hampshire, Oklahoma, Nebraska, Kansas, Vermont, and West Virginia.

Wisconsin was tied for 45th out of 50 in the 2024 Sound Money Index. Enactment of this measure is expected to boost the state’s ranking dramatically.

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