Texas Senate Bill SB1903

Texas 2019 - 86th Regular

Caption

Relating to the exemption of precious metals held in a depository in this state from ad valorem taxation.

Impact

The implementation of SB1903, once effective, would alter the tax landscape regarding precious metal investments in Texas. By exempting these metals from property taxes, the bill is projected to incentivize individuals and businesses to store their precious metals locally, potentially leading to an influx of capital into Texas-based depositories. This change aims to enhance state competitiveness in the precious metals market, ensuring that the state becomes a more favorable location for those interested in investing in physical precious metals without the financial burden of taxation.

Summary

SB1903 proposes an exemption from ad valorem taxation for precious metals held in commercial depositories within the state of Texas. Under the provisions of the bill, precious metals that are stored in a recognized commercial depository, which is defined as a business primarily engaged in the storage of precious metals and that maintains adequate insurance for these deposits, would not be subject to property taxes. This legislative measure aims to encourage investment in precious metals and make it more financially attractive for individuals and businesses to store such assets within Texas.

Contention

While the bill may offer substantial benefits to investors and the wider economy, there are notable points of contention surrounding it. Critics may express concerns about the impact of such tax exemptions on overall state revenue, especially if a significant number of taxpayers begin to exempt their precious metal holdings. Additionally, there is potential debate around the fairness of providing tax benefits for specific asset types compared to other investments or sectors that do not receive similar exemptions.