by Mitch Kokai
Senior Political Analyst, John Locke Foundation
[W]hen he takes office, President Romney should urge Congress to pass a bill similar to that proposed by Ron Paul, the Free Competition in Currency Act, which would abolish all federal taxes on gold and silver bullion, as well as ban state and local taxes on them. It would explicitly allow gold-based monetary transactions and would remove the onerous reporting rules that now afflict gold and silver bullion buyers.
Currently the federal government wages a virtual jihad against any attempt by individuals or companies to create gold-based monetary instruments for commercial transactions. Several years ago Bernard von NotHaus started a company to do just that, issuing coins and paper bills called Liberty Dollars. They were receipts for gold and silver bullion. He now faces massive jail time.
The tide is turning on this issue. On the national level we should do as Utah did in 2011: eliminate all taxes on transactions in gold and silver bullion. When you “purchase” a $20 bill for two $10 bills, you don’t pay sales tax. When you exchange dollars for euros, you don’t pay a government tax on the transaction. Utah decreed that U.S.-minted gold and silver coins are legal as currency.
An interesting historical fact is that until 1933 the U.S. government itself issued gold-based dollars that floated freely with currencies issued by numerous national banks.
The combination of getting a serious debate on the gold standard going and sweeping away our legal tender laws barring competitive domestic currency would hasten the day that we’ll once again have a gold-based currency like that which did our country so much measurable good for 180 years.