Kentucky Governor Andy Beshear has decided he’s going to continue collecting sales tax on the sale of gold and silver despite a new law repealing the levy and an attorney general opinion calling his line-item veto of the provision unconstitutional.
Only five other states levy a sales tax on gold and silver.
Initially, Rep. Steven Doan and Rep. John Hodgson introduced a standalone bill to repeal the sales and use tax on gold and silver bullion. The provisions were later inserted into House Bill 8 (HB8), an omnibus revenue and tax bill.
The provisions in HB8 define “bullion” as “bars, ingots, or coins, which are made of gold, silver, platinum, palladium, or a combination of these metals, valued based on the content of the metal and not its form and used, or have been used, as a medium of exchange, security, or commodity by any state, the United States government, or a foreign nation.” Currency is defined as “a coin or currency made of gold, silver, platinum, palladium, or other metal or paper money that is or has been used as legal tender and is sold based on its value as a collectible item rather than the value as a medium of exchange.”
The House passed the bill 87-9 and the Senate approved the measure 34-0.
Gov. Beshear signed the bill but used a line-item veto to strike out the sales tax exemption for gold and silver.
“If you own gold, you can afford to pay sales tax,” Beshear wrote in his veto message. “Tangible goods are the primary basis of the sales tax.”
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