Ohio again exempts investment bullion
- Sales Tax News
- June 16, 2016 | Gail Cole
Ohio’s on-again, off-again exemption for investment bullion and coins is on again, beginning January 1, 2017. A bill exempting investment bullion from Ohio sales tax, introduced more than a year ago, was signed into law by Governor John Kasich (R) on June 14, 2016.
The governor did not approve a 2013 measure seeking to restore the tax break that was repealed in 2005. This time around, the language was different. According to Governor spokesperson Emmalee Kalmbach, “What he signed was narrower and more limited and very different from what he vetoed in House Bill 59.” Enacted Senate Bill 172 specifically exempts from tax the sale or use of investment metal bullion and coins, thereby ensuring that luxury watches and jewelry are not eligible for the exemption. The bill reads:
“’Investment metal bullion’ means any bullion described in section 408(n)(3)(B) of the Internal Revenue Code, regardless of whether that bullion is in the physical possession of a trustee. ‘Investment coin’ means any coin composed primarily of gold, silver, platinum, or palladium.”
Supporters of the exemption are pleased. Democratic lawmaker Mike Sheehy pointed out that many coin shops work on small margins and that the tax caused some to shutter. Others noted that without the exemption, Ohio bullion and coin dealers suffer from a competitive disadvantage because neighboring states Michigan and Pennsylvania don’t tax those sales. Although Ohio residents owe use tax on taxable goods purchased in other states for use in Ohio, few actually pay it.
A small number of legislators opposed the exemption on the grounds that it was abused in the past and could be again (The Toledo Blade).
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