Thursday, March 3, 2011

Utah Law - Pay your tax in gold or silver??

This is incredible. The Utah house is going to vote next week on allowing US federal government issued gold and silver coins. This is monumental!!!

From foxnews.

The Utah House was to vote as early as Thursday on legislation that would recognize gold and silver coins issued by the federal government as legal currency in the state. The coins would not replace the current paper currency but would be used and accepted voluntarily as an alternative.

The legislation, which has 12 co-sponsors, would let Utahans pay their taxes with gold and also calls for a committee to study alternative currencies for the state. It would also exempt the sale of gold from the state capital gains tax.

So if you had an American silver eagle or American gold eagle it would be considered legal tender in Utah. This would open up all sorts of opportunities for businesses to transact in gold also. This is truly amazing and I am speechless.

In this same article it mentions one of the stupdiest comments Bernanke has ever utterred (and he has said some stupid stupid things over the years).

Bernanke also said that gold couldn't return as the world standard because there's not enough gold in the world to effectively support the U.S. money supply.

Think about that for a moment. Idiotic. It isn't based on amount. It is a function of price. So you adjust the price of gold to make the value of gold to equal the money supply.

Utah apparently isn't the only state to be considering such a move.

Twelve other states have offered similar proposals: Georgia, Montana, Missouri, Colorado, Indiana, Iowa, New Hampshire, South Carolina, Tennessee, Washington, Vermont and Oklahoma.

Gold and silver are quickly moving back to currency status.


mac50 said...

I would like to know if Eagles are legal tender then do you pay state income tax on purchases, I expect not.

Now what about fed capital gain tax. If you live in Utah and purchase eagles which proceed to go up relative to $'s would a resident or non-resident have to pay capital gain tax? What of the Obama Care gold tax, is it in force now?

Market Seer said...

He mac50 - I haven't read the law but my understanding is no you would pay state income tax on purchases.

Capital gains tax only applies to state. So the federal government capital gain tax u would still have to pay.

There is no Obama Care gold tax as of right now.

mac50 said...

Market Seer: Mac50 here. I ment sales tax and I think you are right that there would be no sales tax.

The "gold tax' is in the bill to commence Jan 1, 2012 but I haven't found a rate yet.

I don't see much benefit to people in Utah if there are no tax breaks re Fed capital gains. What do you think and when do you think the dollar / bond / interest rate bomb goes off?

Market Seer said...

The gold tax will most likely never be law. That was in the healthcare bill. Senate already voted to repeal that last February and the House is set to vote tomorrow I think. Can read more about it here:

It isn't about a benefit to people in Utah. It probably has very little day to day impact. It is more about the statement. A government is willing to take gold as money.

You last question goes way beyond anything I can respond to in a blog comment but in general I think the Euro and Yen is in worse short term shape than the dollar. Dollar may go down but I would not be surprised to see a shocking dollar surge in the next year or so. Market likes to disrupt the obvious and so many people hate the dollar right now it seems everyone is on one side of the boat when you have the Euro and the Yen as a joke for currencies.

Rebecca said...

It won't do any good to allow payment in just the U.S. gold/silver coins because they print values of $50 on a gold coin that's really worth $1500. So to pay $100 in taxes you'd have to fork out $3000 worth of gold to pay it. The FED has it rigged that way so they have complete monopoly. To truly fix the system, we need a law that allows payment with gold and silver at the rate of their current market value, not based on the value printed on the coin (the FED did that on purpose to make SURE gold and silver would never be used in competition with their paper notes). One guy though of a solution, to pay workers with gold coins (worth much more than their face value), and then technically the income taxes were negligible because the face value of the coins is so tiny. Trying to solve the problem that way didn't work out either, because the fed just put the guy in jail for 296 years. The FED will not release hold on their slaves (any who resist slavery will be jailed for life).

Market Seer said...

Agree Rebecca. The Utah law is more symbolic than anything. A step in the right direction. Texas is considering something similar.

itm said...

Great post about pay your tax in gold or silver,this time Gold has been advancing for over 10 years now, from a low of $252 per ounce in 1999 to where it sits today at $1,755, which is a gain of over 595%. With gold at unprecedented levels (previous bull market high was $850/oz) is it any wonder why someone would question starting to acquire gold?
us gold coins