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Arizona Senate Approves Gold and Silver as Legal Tender

Arizona is on its way to becoming the second state, after Utah, to recognize gold and silver as legal tender authorized for payments of both debts and taxes.

On Thursday, the Arizona Senate voted in approval of SB 1439, a bill that allows business and the state government to accept payments in gold and silver.

Known as the Legal Tender Bill, the measure put before the Senate states that legal tender in the state of Arizona consists of legal tender authorized by Congress, specie coin issued at any time by the U.S. government, and 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 legal tender.

At the current time, all debts and taxes in Arizona, as well as the rest of the United States, are paid either with Federal Reserve Notes authorized as legal tender by Congress or with coins issued by the U.S. Treasury, very few of which contain gold or silver.

Article 1, Section 10 of the United States Constitution states that no state shall coin money, though the same section stipulates that no state shall make anything but gold and silver coin a tender in payment of debts. Per the language of the Constitution, the sponsors of the bill feel that it will simply respect the use of gold and silver as legal tender without coining new money.

Additionally, the law also exempts the taxation of the exchange of gold and silver into any other currency, stating that gold and silver as legal tender would not be subject to tax or regulation as property other than money.

S.B. 1439 has been modeled after Utah’s legislation, which became the first to pass and be signed into law. Several other states have introduced similar measures motivated by the dollar instability that is perceived to be an effect of the monetary policy of the U.S. central bank, the Federal Reserve.

While the value of the dollar is well known to have plummeted since its inception in 1913, gold and silver have held their value on a historical basis. In the last 100 years, the value of the dollar has fallen 98 percent against gold.

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