HB 1441 — Summary (North Dakota, 2024-2025 session)
Status
- Introduced: November 21, 2024
- Action: Second reading — failed to pass (yeas 18, nays 27). The bill did not become law.
Primary purpose
- To (1) create a new chapter in Title 51 of the North Dakota Century Code recognizing and regulating “specie legal tender” (gold and silver specie), (2) bar state taxation on transactions in that specie legal tender, and (3) declare that United States (and other) central bank digital currencies (CBDCs) are not legal tender in North Dakota. The bill also amends statutory definitions of “money” and “central bank digital currency” in two other code sections.
Key provisions and changes
- New statutory definitions (Title 51, new chapter):
- “Specie”: refined precious metal bullion coined, stamped, or imprinted with weight and purity and valued primarily for metal content (i.e., traditional gold/silver bullion).
- “Specie legal tender”: gold or silver specie issued by the United States or any other form of gold or silver specie.
- “Central bank digital currency” (CBDC): a digital currency or monetary unit issued by the U.S. Federal Reserve, a federal agency, a foreign government or central bank, a foreign reserve system, or an intergovernmental organization, where the currency is made directly available to consumers by — or processed/validated directly by — that issuing entity.
- Legal tender status:
- Declares specie legal tender to be legal tender in North Dakota.
- Declares a central bank digital currency to not be legal tender in the state.
- Tax treatment:
- Provides that the exchange, purchase, or sale of any type or form of specie legal tender may not give rise to any tax liability of any kind (i.e., statewide statutory exemption from taxation for those transactions).
- Amendments to existing definitions:
- Revises the state “money” definition (in section 13‑09.1‑01 and 41‑01‑09) to exclude central bank digital currency as defined by the bill.
- Adds the CBDC definition into the general definitions chapter (41‑01‑09).
Who would be affected
- Individuals and businesses dealing in gold and silver bullion (miners, refiners, dealers, investors, retailers) — transactions in qualifying specie would be statutorily shielded from state taxation under the bill’s language.
- Consumers and merchants — the bill declares specie legal tender in state law (potentially affecting acceptance/transactions, though private contract law may also apply).
- Financial institutions, payment processors, and state tax authorities — new definitions and a tax exemption would alter treatment of bullion transactions and digital currency instruments under state law.
- Entities planning or supporting any U.S. central bank digital currency — the bill would deny legal-tender status to such instruments within the state.
Potential impacts and legal considerations
- State revenue: an explicit tax exclusion for specie transactions could reduce state and local tax receipts tied to such sales/exchanges (magnitude depends on transaction volume in North Dakota).
- Commerce and payments: by declaring specie legal tender and excluding CBDCs from legal‑tender status, the bill intended to promote use of physical precious-metal money while precluding state recognition of CBDCs. Practical effects would depend on private-sector acceptance and federal law.
- Legal uncertainties:
- Federal preemption and U.S. Constitutional issues could arise (the Constitution grants Congress broad authority over coinage and legal tender). Whether a state can unilaterally designate forms of legal tender or immunize transactions from taxation may be subject to judicial review.
- The bill’s definition of CBDC is broad (includes foreign-issued digital currencies and those “made directly available to a consumer”), which may raise ambiguity in application.
Procedural / timeline notes
- The bill created a new chapter to Title 51 and amended two existing code sections to add or modify definitions.
- Despite committee and floor consideration, HB 1441 did not advance past the second reading (failed vote recorded: yeas 18, nays 27) and therefore did not become law.
If you want, I can:
- Pull the precise statutory text changes side‑by‑side with existing code language; or
- Provide a short analysis of likely constitutional or federal-preemption legal issues that could arise if a similar law were enacted.
