By Hubert Walker for CoinWeek ….
UPDATE, 7-6-2015: House Bill 26 was considered by the Ohio State Senate for the first time on June 18, and was referred to the Senate Ways and Means Committee on June 24.
On Wednesday, June 17, the Columbus Dispatch in Columbus, Ohio reported that the Ohio House of Representatives had approved a bill that same day that would restore the sales tax exemption on bullion coins and other collectible coins.
According to the bill’s sponsor, State Representative Ron Maag (R-Lebanon), House Bill 26 is meant to help precious metal dealers in the state of Ohio compete with dealerships from out of state. It will amend section 5739.02 of the Ohio Revised Code to make a sales tax exemption for bullion and numismatic coins. Representative Maag points out that 32 states already have such tax exemptions on the books–including Pennsylvania, Ohio’s neighbor to the east and a major beneficiary of the fallout from Ohio’s current sales tax regime.
Maag also pointed out that the American Numismatic Society (ANS) and the Central States Numismatic Society (CSNS) no longer hold their conventions in the state of Ohio due to the negative impact Ohio’s sales tax would have on participating dealers and vendors.
A fiscal report completed for this legislation provides evidence that even with the sales tax in place, Ohio precious metal sales totaled between 101 and 135 million dollars at the time of the study in 2012. The presumption is that Ohio coin dealers stand to see even higher total sales once the sales tax on coins and bullion is lifted.
Several coin dealers testified to the ill effects of the sales tax on their businesses and the perceived benefits of an exemption during hearings concerning House Bill 26. According to the Dispatch, no one gave opposing testimony.
The state, however, stands to lose about $5.6 million in revenue should the amendment become law.
Ohio had previously exempted “investment” coins and bullion from the sales tax in 1989, but this exemption was repealed in 2005. Notably, this is around the time that revelations regarding the wrongdoing of Thomas Noe in the “Coingate” scandal that reached the highest levels of the Republican Party in Ohio came to the public’s notice. The political repercussions from Coingate resulted in major losses for Ohio Republicans in the 2006 elections.
Noe, a former coin dealer from the Toledo area and, as former Chairman of both the Lucas County Republican Party and the 2004 Bush-Cheney presidential campaign in Northwest Ohio, a power player in state GOP politics, has recently dropped his appeals and asked Republican Governor John Kasich for clemency and a commutation of his sentence. He was convicted in 2006 on 29 of 40 felony counts of forgery, money laundering, aggravated theft and engaging in a pattern of corrupt activity. Noe has served six years of his 18-year sentence.
The current bill passed 81-11. It now moves to the Ohio State Senate for consideration.
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