Sen. Scott Jenkins, R-Plain City likes the idea of money you can sink your teeth into. So did the Senate today in passing out a house bill that would allow Utah to recognize gold and silver coins as currency.
Senators were passed out gold coin chocolates this morning in anticipation of Jenkin’s presenting the final reading on a house bill from Rep. Brad Galvez, R-West Haven to allow gold and silver coins to be accepted as legal tender. “This bill has to do with Article 1 Section 10 of the Constitution that says states shall make gold or silver coins tender payment,” Jenkins said.
He clarified that the bill would not compel any one to buy gold or silver coins. He also noted the substitute bill would require the interim Tax and Revenue Committee to study the efficacy of the tender before the 2012 session. The bill also suggests that the interim study explore the possibility of making gold and silvercoins tobe used for paying debts, public charges and taxes to the state.
Even with further plans for study, not every Senator saw the bill as good as gold.
Sen. Ross Romero, D-Salt Lake City pointed out that federally recognized gold and silver coins are exempt from sales and use taxes and another provision in the bill also negated a capital gains tax on the coins by offering a credit.
“By eliminating the capital gains we are creating an incentive for this investment vehicle over others,” Romero said. “I don’t think that should be the state’s policy.”
Sen. Margaret Dayton, R-Orem challenged Jenkins on the fiscal note, which indicated that state income tax revenue—which funds public education--could take as much as a $550,000 hit starting in 2013. “There is an outside possibility of that,” Jenkins said.
Still the idea of encouraging gold currency as a means of bolstering the dollar was one the Senate banked on and sent the bill on to the Governor’s desk with a 17—7 favorable vote.