U.S. Representative Alex Mooney of West Virginia has reintroduced legislation aimed at removing federal income taxation from gold and silver coins and bullion. The bill, known as the Monetary Metals Tax Neutrality Act (H.R. 8279), has gained support from various groups including the Sound Money Defense League and Money Metals Exchange.
The legislation seeks to clarify that the sale or exchange of precious metals bullion and coins should not be subject to capital gains tax or any other federal income calculations. This move would treat gold and silver as non-taxable entities, placing them on par with the U.S. dollar.
Reps. Scott Perry of Pennsylvania and Randy Weber of Texas have joined Mooney as original cosponsors of the bill. Mooney argues that gold and silver coins are constitutionally recognized as money and legal tender, hence they should not be taxed as collectibles.
Currently, the IRS categorizes gold and silver as collectibles, subjecting them to a high long-term capital gains tax rate of 28%. However, proponents of sound money argue that this taxation is inappropriate, given the constitutional recognition of gold and silver as money.
The bill proposes that no gain or loss should be recognized on the sale or exchange of certain precious metals, including those minted by the U.S. Mint or refined bullion, coins, bars, rounds, or ingots.
Supporters of the bill argue that taxation on precious metals undermines individuals seeking alternatives to the Federal Reserve Note dollar to protect their savings. They contend that inflation, largely driven by federal policies, erodes the value of fiat currency over time.
The introduction of the Monetary Metals Tax Neutrality Act aligns with a broader trend seen in various states, where sales tax on precious metals purchases has been eliminated, and efforts to eliminate state income taxation of gold and silver have gained momentum.
