Proposed Tax Changes Could Impact Precious Metals in New York
New York state lawmakers are considering a significant policy shift that could eliminate the sales tax exemption on bullion purchases over $1,000. This exemption has long provided financial relief to investors and collectors, allowing them to buy gold, silver, platinum, and palladium without additional tax burdens. If repealed, New York would become one of the few states imposing a sales tax on investment-grade precious metals, increasing costs for investors and potentially driving business out of state.
The proposed change stems from a report by Senator Andrew Gounardes, chair of the New York Senate Budget Committee, which includes the bullion exemption in a broader review of state tax breaks. The report suggests that New York loses over $600 million annually due to various tax exemptions, prompting lawmakers to reconsider their policies. However, removing this exemption could have serious consequences for the precious metals industry, small businesses, and investors.
February 27 Hearing: Why This Issue Demands Attention
The New York Senate and Assembly have scheduled a hearing on February 27, 2025 to discuss potential revisions to the bullion tax exemption. If the exemption is removed, gold and silver investors will face higher upfront costs, discouraging people from using bullion as a safeguard against inflation and financial uncertainty.
This policy shift comes despite the fact that over 41 states, including neighboring New Jersey, have either fully or partially repealed sales taxes on precious metals. These states recognize bullion as a financial asset rather than a consumer good, eliminating unnecessary tax burdens for investors. If New York reverses its tax-free status, it will become less competitive than other states, potentially driving investors toward out-of-state bullion dealers or tax-free online platforms.
How a Sales Tax Could Impact Precious Metals Investors
The removal of New York’s bullion tax exemption could create several negative consequences for investors, collectors, and businesses:
- Higher Costs for Investors: A sales tax on bullion purchases would significantly increase the overall cost of gold, silver, platinum, and palladium, making it harder for individuals to invest in precious metals and diversify portfolios.
- Reduced Market Participation: Higher costs could deter new investors from entering the market, making it more difficult for individuals to use gold and silver as hedges against economic uncertainty.
- Weakened Local Bullion Market: A tax increase could push dealers and investors to conduct business out of state, causing economic losses for New York-based bullion retailers.
- Less Financial Security for Investors: Precious metals serve as safe-haven assets during economic downturns. By imposing additional costs, lawmakers would be making it more expensive for New Yorkers to protect their wealth.
New York Should Follow National Trends, Not Reverse Course
Most U.S. states have recognized the importance of precious metals investments and have acted accordingly by removing bullion sales taxes. These tax-free policies encourage economic growth, attract investors, and protect citizens' ability to store wealth in gold and silver.
If New York reinstates this tax, it will move in the opposite direction of national trends, creating unnecessary financial burdens on investors and making the state less attractive for precious metals transactions. Instead, New York lawmakers should acknowledge that gold and silver serve as alternative assets crucial for financial stability and maintain the bullion tax exemption.
Protect New York’s Precious Metals Market: Take Action Now
The proposed tax policy is not final, meaning there is still time to fight against it. If you live in New York or are concerned about fair access to gold and silver investments, now is the time to act.
The National Coin & Bullion Association (NCBA) and other industry advocates are closely monitoring this issue, but they need public support to defend the sales tax exemption. Without resistance, this policy change could pass, making it more expensive to buy and invest in precious metals in New York.
How You Can Help:
Contact your state representatives and express your opposition to this tax proposal. Let them know that:
- Gold and silver are financial assets, not consumer goods, and should remain tax-exempt.
- Reinstating a sales tax on bullion will hurt investors, small businesses, and local dealers.
- Higher taxes on precious metals create financial barriers for investors, retirees, and collectors.
Join the movement: If you want to support efforts to protect the exemption and educate lawmakers, contact ncba@ncbaassoc.org to participate in advocacy efforts.
February 27 Is the Key Date – Make Your Voice Heard
With only weeks before the New York Senate and Assembly hearing, time is running out to stop this policy change. Lawmakers must hear from investors, collectors, and industry professionals who oppose the reinstatement of sales tax on bullion.
New York’s Precious Metals Market Must Remain Competitive
New York’s exemption on bullion sales tax has benefited investors and businesses for years. Eliminating this exemption could weaken the local bullion market, drive investors away, and increase costs for those looking to safeguard their wealth through gold and silver.
The upcoming hearing will determine the future of precious metals taxation in New York, and it’s up to investors and collectors to fight back. Spread the word, take action, and ensure New York remains a fair and competitive market for bullion investments.