Kentucky to Eliminate Sales Tax on Precious Metals

Looks as though my home state is eliminating the sales tax on bullion. From what I read it also includes coins and paper money.

The bill was first introduced alone then integrated into another. The governor tried to line item veto the proposal, but the veto wasn't valid as they can only be done in certain bills. The bill including the elimination of the sales tax for precious metals was not one of those bills.

The governor could try and challenge, but with majority support in the state legislature and grass roots campaigns, it's unlikely to be successful.

 

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I remember that this was one of the main discussions at one of my coin club meetings. I live about 35 miles north of Louisville, and it's quite crappy that they still charge tax. That's why I haven't been to the coin shops in Louisville, to be honest. Hopefully it's one step closer to no tax on coins, period.

 

You just have to quietly go in and ask if you pay in cash if sales tax will be waived. Some shops are strict and fearful of the IRS/state tax board/dept. of revenue while others are like, "Sure. No problem."

 

It's the same way here in NC. Good for me, obviously, but I'm still not sure why my hobby deserves a carve-out more than any other.

 

Congratulations!! All states should not have sales tax on coins, bullion or food.

 

Luckily, as far as I can remember, food hasn't been taxed, only fast food, sodas, candy, etc. are.

 

Heh. Here, food is still taxed at 2%.

I remember short trips from my in-laws to Alabama, where gas taxes were super-low, but ALL groceries were taxed at 10%. I guess if your kids were hungry you were supposed to take them for a drive to distract them.

 

You wouldn't want to try that in Minnesota, possibly being charged with a tax evasion Gross-Misdemeanor, legally requiring a report.

Even before we had a bullion sales tax law, I lost my prepaid funds for silver dime full-bags of coins when officers confiscated complete inventory of 2 precious metal firms.

2 Bankruptcies!

 

What they really need to do is make this nation wide including online sites and dealers including PayPal, we have no tax
here in Nevada so that’s a good thing

 

That is state tax, what is the situation like on the federal level? For example, if somebody in the USA wins a coin worth 1000 USD at a coin auction in Germany, does that person have to pay any taxes to the federal government on it?

 

We do not. All sales taxes in the US are at state and local levels; there's no federal sales tax, although various political figures propose one from time to time (to replace other existing tax streams).

 

Nice, here in Croatia the situation is beyond criminal, on coins imported from outside of the EU they charge you 25% VAT + the shipping company that does the customs paperwork (and by "doing customs paperwork" I mean they send you a Word document to fill out and sign, and then you send that filled out and signed document + the invoice back to them, then they send you the amount that needs to get payed, and then after you have payed it you have to send them the proof of payment PDF from your bank, and then they send it all to the moochers at customs, after which your coin is released for delivery (which in the case of the government-owned Croatia Post might not happen for several working days)) charges you 30 something or 40 something USD for that "service", the only exceptions to this are coins designated by the EU as "investment gold", so the gold 10 USD American Eagle coin for example is exempt from VAT.

 

Wow, just when I think I might be starting to understand the idea of VAT...

It's supposed to be a tax paid at each stage of production based on the value added to a product in that stage, right? So, basically a tax on profit at each stage, credited back when the product is sold onward. But the entire VAT is due when the item is sold for "final consumption".

So... what does it mean to "consume" a collectable coin? Can you claw back the VAT you paid if you sell the coin back to a dealer, then, or on to another collector?

Here in the US, we generally pay somewhere in the range of 5%-10% sales tax on the total value of a purchase. Non-local (interstate or international mail-order/Internet shopping) is taxed at the time of sale now; not long ago, it wasn't, with most states requiring people to report the amount they spent on mail-order/Internet shopping and pay sales tax ("use tax") on it. You can imagine how low the level of compliance was under that policy. So, now it's enforced at time of sale, imposing great expense on sellers who need to compute effective sales tax for every state, city, county, or other tax-levying jurisdiction in the entire country. In practice, sellers engage a service that takes care of that calculation, "for a reasonable fee".

Our effective tax rate is lower than yours. On the other hand, we pay thousands to tens of thousands of dollars a year for "medical insurance", partly subsidized by our employer if we're lucky enough to have one, and can still be bankrupted by medical expenses from a single auto accident (and you know how we love our automobiles). Which is better? Depends on how many coins you buy, and how many accidents you're involved in, I suppose...

 

While there are different rates and in rare cases exemptions, yes, in the majority of cases VAT will be applied several times during the same process.

No, you can't get the VAT back when you sell it on.

In Croatia for quite some time now we have had fiscal memory devices in place, which immediately through the internet send all of the information (including the personal identification number (I guess the American equivalent would be the social security number) of the cashier) to our version of the IRS.

In Croatia employers must pay contributions towards basic state health insurance and basic accident insurance (16,5% on the gross salary, so-called “gross II salary” or total cost for the employer).

Yes, the insane legal, medical, etc. fees in the USA are amongst the top reasons why I would never move there.

 

In any case, after my bids at non-EU auctions are sorted out one way or the other over the next month or so, I only plan to take part in EU coin auctions + the SINCONA ones in Switzerland (since for EU customers they move the coins to their subsidiary in Germany, and then ship them to the EU customers from there), and I will think long and hard about directly purchasing coins that cost more than a few hundred EUR from sellers outside of the EU, because I am beyond tired of getting fleeced by the communist moochers at customs here.

 

That sounds like an expensive proposition
if you an avid collector outside your country
do they also charge a tax in coins that you
bring in to the country on your person ?

 

Anyway, at the recent Stock Bower's Galleries auction I finally won a coin that is explicitly exempted from VAT by the EU, and of course the foul communists here in Croatia charged me VAT anyway, because since it didn't come with something called a "CEE certificate", they define it as "collector gold", and not "investment gold", in any case, I am done with with all non-EU coin auction houses that either don't have EU subsidiaries or don't ship "discreetly".