Letter To The Editor: House Bill 1046 Creates Jobs
Dear Editor,
Indiana House Bill 1046 will make a difference. If passed, it will create new jobs and bring new revenue to our state treasury. Surprisingly, this simple change in the tax code would have a net tax gain.
Authored by Rep. Greg Beumer and co-authored by Reps. David Wolkins and Robert Heaton, the bill is 14 lines long. It exempts Indiana bullion sales from state sales tax.
When Michigan exempted their bullion sales in 1999, in the first two and a half years following the change, 150 new coin businesses were established, 600 jobs were created and $1.7 million were received in increased tax revenue. When Ohio did the opposite in 2005, making bullion sales taxable, within six months 100 coin dealerships closed or laid-off staff and Ohio lost hosting major coin conventions.
The Industry Council for Tangible Assets reports that coin conventions could bring $7 million to $15 million per event to major cities like Indianapolis, Fort Wayne and South Bend. These conventions are limited to states which exempt bullion sales from taxation.
The biggest obstacle for this bill is an erroneous Fiscal Impact Statement by a state agency. The agency guessed at the tax impact by allocating a portion of gross U.S. Mint sales to Indiana based on Indiana’s portion of national personal income. This resulted in an estimated $4 million sales tax loss for Indiana.
An informal 2013 survey of bullion purchases, representing $1.2 million in purchases, revealed that only 9 percent of these Indiana residents purchased bullion within the state. So in this example, the state received sales tax on 9 percent of the purchases while missing income tax revenue from the profit of 91 percent of the sales.
Why would a knowledgeable Hoosier buy bullion from an Indiana coin store when they could pay 7 percent less (avoiding sales tax) in Michigan, Illinois or another tax-exempt state?
It is time to make Indiana competitive with Michigan and Illinois and join more than 30 other states which have exempted bullion from sales tax. This is common sense.
You can help us bring jobs and revenue to Indiana by encouraging your state representative to vote “Yes” on bill 1046.
Brad Skiles
Warsaw
Founder of Hoosiers for Tax-Free Bullion