Alabama Bill Amends Bullion Definition, Extends Expiration Date, and Repeals Reporting Requirements
In the summer of 2016, Phil Darby (J & P Coins and Currency) and Steve Caiola (Alabama Gold Refinery) started collaborating with the National Coin & Bullion Association on a campaign to obtain a statewide coin, currency, and precious-metals bullion sales-tax exemption.
In the summer of 2016, Phil Darby (J & P Coins and Currency) and Steve Caiola (Alabama Gold Refinery) started collaborating with the National Coin & Bullion Association on a campaign to obtain a statewide coin, currency, and precious-metals bullion sales-tax exemption. Darby and Caiola hired Graham Champion (Public Strategies, Montgomery, AL) as the campaign’s lobbyist.
Alabama joined the other states with a sales-tax exemption on June 1, 2018. However, the statute had a five- year sunset provision to provide the state’s fiscal agency the opportunity to verify the projected benefits to the state’s revenue promoted by the campaign.
With the deadline on the sunset provision in sight, the coalition prepared to resume the fight. On February 10, 2021, Senator Tim Melson introduced Senate Bill 218: Taxation, Sales and Use Tax Exemptions for Bullion, Bullion Defined Further, Sales and Use Tax Exemption Extended, Reporting Requirements Waived for Certain Recipients of Tax Exemption. This bill would extend the sunset provision for five more years and change the definition of bullion’s purity from 90% to 80%.
Alabama is eligible to host a national coin show, but opportunities to do so had been impacted by the COVID- 19 pandemic. Extending the exemption five more years would give show producers more time to bring a show to the state. Reducing the definition of bullion to 80% purity also makes sense, because some very early US silver coins had purity as low as 89.24% and some early US gold coins had a purity of 89.92%. Many European silver coins had purities as low as 83.5%. Changing the definition from 90% to 80% avoids potential technical glitches.
Darby again engaged Champion as a lobbyist. The bill was heard by the Senate Finance and Taxation Education Committee on March 11, 2021, and they unanimously passed the bill to the Senate with a favorable recommendation. After it passed the Senate, it was referred to the House Ways and Means Education Committee. Unfortunately, the legislative session adjourned sine die before there was any further action on the bill, and the bill died in the House.
On January 11, 2022, Senator Melson again introduced and championed Senate Bill 13, which amends the definition of bullion (as in the previous bill), extends the expiration date for the sales- and use-tax exemption another five years, and repeals reporting requirements for dealers. SB 13 was unanimously passed out of the Senate Finance and Taxation Education Committee on February 23, 2022, and transferred to the House, where it was read for the first time and referred to the House Ways and Means Education Committee. On March 17, the bill was read for the second time and placed on the calendar. The House Ways and Means Education Committee reported the bill favorably, and its third reading occurred on April 6, 2022, when unanimously passed. The bill was delivered to Governor Kay Ivey the following day and was signed into law on April 14, 2022. The bill is effective immediately, with a new expiration date of June 1, 2028.
“This has been a long fight. We are so grateful for the encouragement of NCBA and for Senator Melson’s advocacy of the exemption these last two sessions,” Darby said. “We know the numismatic community in Alabama will have a chance to grow in the coming years and that Alabama’s economy will be the better for it.”
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Source: National Coin and Bullion Association
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