Key Takeaways
- New York’s current sales-tax exemption for precious metals purchases over $1,000 survived the FY 2025–26 budget process under Senate Bill S3009.
- Senate Bill S7875, introduced by Senator Andrew Gounardes, would repeal the exemption entirely, affecting coins, bars and bullion investors.
- The exemption has spurred local investment, supported small dealers and prevented sales leakage to neighboring states.
- Precious-metals investors and coin collectors must monitor legislative developments and weigh alternative acquisition strategies.
- Engaging with the National Coin & Bullion Association (NCBA) and New York-based dealers can help protect collector interests.
- Bullion investors should factor in sales tax impact when comparing yields on physical assets vs. ETFs or out-of-state purchases.
In May 2025, New York Governor Kathy Hochul signed Senate Bill S3009 into law without language repealing the long-standing precious-metals sales-tax exemption found in Statute 1115(a)(27). That provision had shielded purchases of coins, bars and rounds over $1,000 from the state’s 4 percent sales tax, supporting a vibrant local bullion market. However, State Senator Andrew Gounardes quickly filed Senate Bill S7875, aiming to eliminate the exemption altogether. Coin collectors and bullion investors now face renewed uncertainty as Albany heads into the next legislative session.
Background: Statute 1115(a)(27) and the FY 2025–26 Budget
New York’s sales-tax code currently exempts purchases of precious metals—defined as coins and bullion of gold, silver, platinum or palladium—when the total sale exceeds $1,000. During budget negotiations in April 2025, a proposal to repeal that exemption was considered but ultimately dropped from the enacted FY 2025–26 plan under Senate Bill S3009. Industry groups, led by the National Coin & Bullion Association (NCBA), argued that repealing the exemption would drive dealers and investors across state lines to tax-free jurisdictions.
Senate Bill S7875: What It Would Change
Senate Bill S7875, introduced May 19, 2025, proposes to strike Statute 1115(a)(27) from the Tax Law, eliminating all sales-tax relief on purchases of precious metals regardless of value. If enacted, consumers would pay the full 4 percent state tax plus applicable local rates on every ounce of gold, silver, platinum or palladium they buy from New York dealers. For a one-ounce American Silver Eagle priced at $30 (spot plus premium), that tax would add roughly $1.20 plus local taxes—trivial on one coin but consequential for larger purchases.
Impact on Coin Collectors and Bullion Investors
- Collectors: Higher costs on purchases may discourage routine acquisitions of proof sets, commemoratives and low-mintage bullion coins from New York dealers.
- Local dealers: Brick-and-mortar shops could lose sales to online or out-of-state competitors, threatening small-business viability.
- Bullion investors: Tax adds a drag on returns from stacking physical metal when compared with tax-efficient vehicles like ETFs or overseas storage.
- Market leakage: Neighboring states such as New Jersey and Connecticut might see a bump in cross-border purchases.
Strategies for Collectors and Investors
While the exemption remains in place for now, savvy buyers can prepare for potential repeal:
- Engage with NCBA: Join or support the NCBA’s advocacy efforts at ncbassoc.org/membership.
- Build dealer relationships: New York dealers may offer tax-inclusive pricing or loyalty discounts to offset potential tax changes.
- Alternate jurisdictions: Consider periodic purchases in tax-free states (e.g., Delaware, Oregon) or through mail order—but verify shipping and insurance costs.
- Storage solutions: Explore allocated storage programs in New York that defer sales tax until withdrawal, or use out-of-state secure vaults.
- Cost averaging: Dollar-cost average small purchases under $1,000 to maintain exemption eligibility.
What This Means for Bullion Investors
Physical-metal investors should quantify the sales-tax drag on long-term returns. A 4 percent tax on a 1 ounce gold bar at a $2,300 price point costs $92—reducing your break-even price and overall yield. In contrast, gold ETFs like GLD carry expense ratios around 0.40 percent annually with no upfront purchase tax. Before committing to physical bars or coins, factor in:
- Sales tax vs. storage fees in vaults (allocated vs. unallocated).
- Premiums over spot and any dealer surcharges.
- Liquidity considerations: retail vs. wholesale bid‐ask spreads.
- Estate planning: state vs. federal tax treatment on inherited metals.
How to Stay Informed and Take Action
New York legislators are expected to debate S7875 in early 2026. Collectors and investors can help protect the exemption by:
- Contacting Assembly and Senate members to express support for Statute 1115(a)(27).
- Participating in NCBA’s letter-writing campaigns and public hearings.
- Monitoring developments via the official bill status page.
- Subscribing to coin-collecting newsletters and local tax bulletins for updates.
By staying engaged and exploring alternative acquisition strategies, coin collectors and bullion investors can minimize the impact of potential tax changes and ensure continued access to precious metals within New York State.