Maine Law Would Support Ownership of Sound Money
A freedom-minded Maine legislator has introduced a proposal to remove sales tax on precious metals purchases, removing a disincentive for individuals to protect themselves against the disastrous effects of the Federal Reserve bank.
In February, the Maine Senate voted yes to print Senator Brakey’s (R-Auburn) Senate Bill 664, which follows the lead of many other U.S. states who have already affirmed that it is wrong to assess a tax on precious metals purchases. Removing Maine sales tax from monetary metals has multiple benefits.
First, policies that discourage precious metals ownership reduce the likelihood that Mainers will take steps to insulate themselves from the inflation and financial turmoil that flows from the Federal Reserve System.
By issuing unbacked Federal Reserve Notes, commonly referred to as “dollars,” savers in those dollars have been losing significant purchasing power over time. Holding savings in gold and silver -- the only money mentioned in the United States Constitution -- is an effective way to protect purchasing power.
Second, purchasers of precious metals coins, bars, and rounds are not “consuming” them, making the notion of assessing a sales and/or use tax invalid. Precious metals purchasers are really holding these metals for resale or exchange, like an investment or currency.
And third, removing Maine’s sales tax from precious metals will benefit in-state businesses who are currently losing sales to out-of-state precious metals dealers. Investors won’t want to pay, for example, $87.50 in sales taxes on a $1,250 purchase of a one-ounce gold bar. It’s a competitive marketplace, so buyers will simply go online or leave the state to purchase gold and silver investments from out-of-state businesses, thereby undermining Maine jobs and state income tax revenues.
As more states reduce the costs and barriers to precious metals ownership, those who diversify some of their savings into hard money will continue to grow, and the concept of sound money will become more widely accepted.
Every day we are seeing the American people open their minds to the historic role that sound money has played. We’ve seen a few presidential candidates talk about it. A few state legislatures, too, have recognized the danger of being totally reliant on a monetary system based on debt and unbacked fiat money, and they’re taking concrete steps to liberalize the laws surrounding gold and silver ownership.
While there is a tremendous amount of work to do, we should be encouraged that the stranglehold central planners have over our money is beginning to loosen. People are taking notice that something about the debt-laden economy and their money isn’t right. And people are realizing that money backed by nothing isn’t actually money at all.
It’s time for Maine leaders to end the unjust taxation on those citizens who wish to own the monetary metals.