New American: Utah House Approves Gold, Silver as Legal Tender
Alex Newman, writing for the New American, reports on House passage of the Utah Legal Tender Act:
The Utah House of Representatives voted on March 4 to make gold and silver coins issued by the federal government into legal tender within state borders, prompting praise from sound-money advocates across the nation. The legislation will now be taken up by the state Senate.
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In addition to possibly making precious-metal coin lawful money for intrastate and government transactions, the bill would exempt gold and silver from state sales, income, and capital-gains taxes. The legislation also states that individuals cannot be compelled to accept precious metals instead of Federal Reserve Notes. It was approved in the House with a vote of 47 to 26.
According to the bill’s summary, it “recognizes gold and silver coins that are issued by the federal government as legal tender in the state and exempts the exchange of the coins from certain types of state tax liability.” Under the measure, Utah citizens would be able to pay their taxes with precious metals at market value, as opposed to the face value used by the federal government, which is far less than the price of the actual gold or silver in the coins.
The legislation would also mandate that the Revenue and Taxation Committee “study the possibility of establishing an alternative form of legal tender” and “recommend whether an alternative form of legal tender should be established.” Those recommendations would be considered in the 2012 legislative session.
Earlier this year, the Utah state legislature was considering a similar proposal known as the “Utah Sound Money Act.” That bill would have recognized gold and silver coins issued by some trustworthy foreign governments as well. It would have gone even further toward normalizing trade in precious metals than the “Legal Tender Act,” and so attracted a broad coalition of prominent backers from across the country including long-time sound-money advocate U.S. Rep. Ron Paul (R-Texas).
“To me, the best road back to a really well-functioning monetary system is through the states, and through the states exercising their monetary power as articulated in Article I, Section 10 of the [U.S.] Constitution to make nothing but gold and silver coin a payment in tender of debts,” said Utah attorney and businessman Larry Hilton, who authored the original bill and has been a key backer of state-based sound-money legislation in Utah.
He told The New American earlier this year in an interview that, “If each of the states — or even just a small handful — do what we’re contemplating here in Utah, I think it would have a very positive impact on the dollar itself.” It would also bring countless other benefits ushered in by competition and the preservation of purchasing power, he added.