Transacting in Gold Can Shaft The IRS
By GCRU Gold News on Tuesday, September 9 2014, 13:56 - Permalink
In 2011, the state of Utah passed a law banning taxes on the use of gold and silver coins as currency and permitting residents to remit state taxes in these coins. Big deal, you might say. That’s already in the Constitution: “No state shall…make anything but gold and silver coin a tender in payment of debts.”
What a delicious opportunity this presents when it comes to taxation. Let’s say the members of a community somewhere here in the USA decide to do all their business in gold. The dollar price of everything would be much less. A $3 latte would go for about ten gold cents, in that the price of gold on the market (circa $1267 per ounce) exceeds that of the official Treasury price ($42.22) by a factor of thirty.
If this community is of decent size, any number of businesses and individuals could make close all their income via gold transactions. Somebody might clear, for example, $3000 in gold income in a year, or $90,000 if translated into paper dollars.
Because of the abundantly established legal precedent for treating gold and paper dollars the same, the maximum subject to taxation would be the $3000, an amount easily eliminated by the standard deduction on the income tax.