As central economic planners at the Federal Reserve continue their vision of "prosperity" through crushing debt and dollar devaluation, some states are fighting back. The Arizona House took a major step toward sound money by passing a bill to eliminate penalties in the form of taxes on gold and silver specie.
The move would be an important step toward currency competition and help undermine the Fed's monopoly on money.
"Rep. Mark Finchem (R-Tucson) introduced House Bill 2014 (HB2014) on Jan. 9. The legislation would eliminate state capital gains taxes on income "derived from the exchange of one kind of legal tender for another kind of legal tender." The bill defines legal tender as "a medium of exchange, including specie, that is authorized by the United States Constitution or Congress for the payment of debts, public charges, taxes and dues." "Specie" means coins having precious metal content.
In effect, passage of the bill would "legalize the Constitution" by treating gold and silver specie as money.
HB2014 passed the full House by a 35-24 vote."
Capital gains tax on gold and silver is an insidious disincentive based on intentional dollar devaluation. When the dollar's purchasing power goes down, the metals' nominal dollar value goes up, triggering a "gain" which is taxed.
"The U.S. Mint is charged with protecting the value of money, but the Federal Reserve creates nothing but debt. Yet Congress authorized a tax when making the exchange of precious metals for dollars. It's illegal and they know it, this bill is an effort by one state to protect the people from such confiscation," said Representative Finchem.