California Laws on Gold & Silver

About California

Admitted to the union in 1850, California is home to 40 million people. The most heavily populated state in the union and the third largest area, California is home to major metropolitan hubs including Los Angeles and San Francisco. California has taken steps to cultivate an environment more conducive to sound money ownership and use.

Last Updated: 11/25

What are the Laws on Gold & Silver in California?

• California State Sales Tax Laws
• California Capital Gains Laws
• California Gold and Silver Money Status
• California Depository Laws
• California State Reserves Laws
• California Government Pension Funds

California State Sales Tax Laws?

California has started the process of freeing gold and silver from bureaucratic shackles.

According to Article 7, Regulation 1599 California enacted a sales tax exemption in 2023 for purchases $2,000 or more.

While California's exemption is a step in the right direction, the law places an unfair burden on those wanting to exchange Federal Reserve Notes for real money, i.e. gold and silver, as many purchasers of precious metals make these purchases in increments below the $2,000 sales amount which triggers the sales tax exemption.

For more information on rolling back sales tax on constitutional money, click here.

California Capital Gains Tax?

California law, like most states, is chalk full of draconian revenue statutes. Under current law, gold and silver are subject to capital gains taxation when exchanged for Federal Reserve notes, or when used in barter transactions.

Income taxes are one major way government bureaucrats penalize holders of precious metals. If you own gold to protect against the ongoing devaluation of America's paper currency (which results from the inflationary practices of the Federal Reserve), you may end up with a "gain" on your gold when it's priced in dollars. Not necessarily a real gain, mind you. It's frequently nothing more than a nominal gain -- but it's nonetheless considered income against which the government assesses a tax.

However, other state legislators across the country have started to recognize that paying taxes on nominal gains is beyond the pale. Arizona recently eliminated capital gains taxation on precious metals and Idaho hopes to follow soon.

For more information on capital gains taxation of precious metals, click here.

Gold and Silver Recognized as Money in California?

California has not yet reaffirmed gold and silver as legal tender. 

Money is not a creation of government. The process through which money was “created” was not one of central planning but of markets. Gold and silver were chosen as money by the free market over thousands of years and should thus be recognized as money.

Following the example envisioned by the Founding Fathers and described in Article I, Section 10 of the United States Constitution, states should reaffirm not only some forms of gold and silver, nor only gold and silver minted by the U.S. Mint (which did not exist when the Constitution was written), but all gold and silver, as the Founders intended.

For more information, click here.

California Depository Laws?

There are private depository options available in California.

Gold and silver bullion depositories provide secure, insured storage of individuals’ or businesses’ assets outside of their homes or businesses. High-level depositories reduce the risk of theft or loss for the owners while providing custodial services for a fee. Storage of precious metals coins and bullion is an important point to consider for individual savers, businesses, financial managers, and even states and countries.

The most impactful thing a state can do as it regards depositories is ensuring that private depositories can establish and operate freely without onerous or privacy-invasive regulations.

Most states have no use for a bullion depository, as most don't own a single ounce of gold. Although one state has established a government-run depository, private depositories are more common, popular, and independent of government control. In most states where they are located, private depositories tend to operate without burdensome regulation or surveillance by government systems, and they are independently audited and insured. 

California Holding Reserves in Gold and Silver?

Financially prudent individuals set aside surplus funds to protect against unforeseen expenditures. This way, when faced with loss of income, house repairs, car trouble, or anything else, they will have a buffer against unanticipated downturns.

In the same vein, almost every state in the United States has established a “savings account” for government operations. Primarily to mitigate a decline in tax revenues that comes alongside economic slumps, states have created so-called budget stabilization funds – colloquially known as “rainy day funds.”

Unfortunately, California does not hold its reserves in gold and silver.

Wyoming and Utah have led by establishing multi-million dollar physical gold reserves to bolster their state's finances.

For more information on Budget Stabilization Funds, click here.

Is California Holding Physical Gold & Silver in Government Pension Funds?

Millions of Americans will rely on pensions once they've reached the age of retirement. Pension fund managers have a fiduciary duty to safeguard funds against foreseeable risks.

With the practices of today's Federal Reserve, there is no risk more foreseeable than inflation! But with very few exceptions, pension money managers are not fulfilling their duty to protect against this significant risk by investing in assets that are specifically suited to defend against the perpetual decline of the dollar's purchasing power. Chief among these assets are physical gold and silver, the most reliable inflation hedges from time immemorial.

Tens of millions of Americans and their employers pour money into pension plans each month, counting on those funds to grow and be there when needed at retirement.

But a time bomb awaits. The bulk of U.S. pension funds are dangerously underfunded, and the assets are often invested in securities that have bleak prospects for providing income that keeps up with a general decline in purchasing power. In the case of underfunded government pensions, higher taxes invariably follow combined with potential default on obligations to retired workers.

Unfortunately, California's government pension funds do not appear to hold ANY assets in physical gold and silver.

For more information on pension funds, click here.

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