New Threat to New York's Precious Metals Tax Exemption as Senate Bill S7875 Introduced

Just on the heels of a major legislative victory, the National Coin & Bullion Association (NCBA) and its New York-based members have successfully defeated a proposal to repeal New York’s sales-tax exemption for precious metals and bullion purchases over $1,000. This critical exemption, protected under Statute 1115(a)(27), remains intact following the passage of Senate Bill S3009, which enacts significant components of New York State’s fiscal plan for the 2025–2026 fiscal year. The final version of the bill signed into law by Governor Kathy Hochul on May 9, 2025, did not include the proposed repeal provision.

However, this victory may be short-lived. New York State Senator Andrew Gounardes has now introduced Senate Bill S7875, which seeks to significantly narrow the scope of the sales-tax exemption for precious metal bullion. Rather than repealing the exemption entirely, S7875 would limit its availability to transactions involving governmental entities and international institutional buyers — effectively excluding individual investors and collectors from benefitting from the tax relief.

“This exemption is not a loophole – it is a proven driver of economic growth, job creation, and investment in New York,” said NCBA executive director David Crenshaw. “Repealing this exemption would place New York at a significant competitive disadvantage, potentially driving businesses and investors to neighboring states and negatively impacting overall tax revenues.”

Additionally, the current $1,000 purchase threshold disproportionately affects smaller investors – such as retirees, military families, and those with modest incomes – by making local purchases of precious metals more costly. Many of these individuals circumvent the tax by buying from out-of-state dealers or utilizing tax-free storage options elsewhere. Instead of eliminating the broader exemption, policymakers should focus on removing this threshold to level the playing field, support New York-based businesses, and reduce the loss of sales to other states.

The current exemption has been a critical component in supporting New York’s precious metals industry, helping to sustain a competitive marketplace and encourage investment in physical assets. Many states, including Florida and Ohio, have previously attempted to eliminate similar exemptions, only to reinstate them after significant market disruptions and economic harm.

Despite this, advocates like Ron Deutsch, director of New Yorkers for Fiscal Fairness, have labeled the exemption as a “ridiculous tax loophole” that disproportionately benefits wealthier investors. However, the NCBA strongly disputes this characterization, emphasizing that the exemption supports small businesses, creates jobs, and encourages investment in tangible assets that contribute to a stable and diversified economy.

For more information or to join NCBA’s advocacy efforts, please contact ncba@ncbassoc.org or visit ncbassoc.org/membership.