SB1439 ‘Legal Tender’ Queued for AZ House Floor Final Vote

BILL #   SB 1439

http://www.azleg.gov/DocumentsForBill.asp?Bill_Number=SB1439&Session_ID=110

TITLE:   legal tender

SPONSOR:   Crandell

STATUS:   As Introduced

PREPARED BY:     Eric Billings

FINANCIAL IMPACT STATEMENT

Description

SB 1439 changes the definition of legal tender to include any gold or silver coin issued by the U.S. government or any coin or bullion containing gold or silver that a court approves.  The bill does not compel an individual to accept gold or silver as payment and prohibits the taxation of exchange between fiat money (paper money) and specie material (gold or silver coin or bullion).  The bill would also prohibit taxation of gold or silver legal tender and would compel individuals using the new legal tender to pay any taxes related to the transaction with the same type of legal tender.

Estimated Impact

The fiscal impact of this bill cannot be determined with available information.

The Department of Revenue and the Treasurer report that they are unable to estimate a fiscal impact at this time.

Analysis

Altering the definition of legal tender to include specie material could possibly necessitate the purchase of additional equipment and facilities or the hiring of specialists such as assayers to allow the Department of Revenue and the State Treasurer to safely and efficiently handle tax and other transactions conducted in the material.  The extent to which these and other agencies may be required to purchase additional materials is dependent on the public’s utilization of specie material.

DOR was unable to provide an estimate.

The Treasurer reports that all of their current contracts prohibit the use of specie coin, and thus does not see an immediate impact from the bill.

Local Government Impact

This bill may have a local government impact to the extent that local governments have to purchase equipment or space to handle transactions in specie material.  Maricopa County reported that the bill would have a compliance impact but was unable to estimate the cost.

LIVINGSTON FLOOR AMENDMENT

HOUSE OF REPRESENTATIVES AMENDMENTS TO S.B. 1439 – 04/04/2013

(Reference to Senate engrossed bill)

Page 1, line 11, strike “and taxes”

Strike lines 25 and 26

Reletter to conform

Amend title to conform

AZ House Engrossed Senate Bill:

http://www.azleg.gov//FormatDocument.asp?inDoc=/legtext/51leg/1r/bills/sb1439h.htm&Session_ID=110

Be it enacted by the Legislature of the State of Arizona:

Section 1.  Title 1, Arizona Revised Statutes, is amended by adding chapter 7, to read:

CHAPTER 7       LEGAL TENDER

ARTICLE 1.  GENERAL PROVISIONS

START_STATUTE1-701.  Definition of specie legal tender

In the statutes and laws of this state, unless the context otherwise requires:

1.  “Legal tender” means an authorized medium of exchange for the payment of debts.

2.  “Specie” means coin or bullion having gold or silver content. END_STATUTE

START_STATUTE1-702.  Legal tender recognition; use of specie

A.  Legal tender in this state consists of all of the following:

1.  Legal tender authorized by Congress.

2.  Specie coin issued at any time by the United States government.

3.  Any other specie that a court of competent jurisdiction rules by a final, unappealable order to be within the scope of state authority to make a legal tender.

B.  Except as expressly provided by contract, a person may not compel any other person to tender or accept specie legal tender. END_STATUTE

START_STATUTE1-703.  Legal tender exchanges; payment of taxes

A.  Notwithstanding any other law, the exchange of one form of legal tender for another does not give rise to liability for any type of tax.

B.  Legal tender is money and is not subject to taxation or regulation as property other than money. END_STATUTE

START_STATUTE1-704.  Enforcement

The attorney general shall enforce this chapter without PREJUDICE to an individual’s right of judicial action pursuant to this chapter. END_STATUTE

Sec. 2.  Effective date

Title 1, chapter 7, Arizona Revised Statutes, as added by this act, is effective from and after ninety days after the fifty-first legislature, second regular session adjourns sine die.

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