Arizona lawmakers are moving to allow residents to invest in gold coins and not have to pay state taxes on any profits they make when they sell them.
Legislation awaiting a final House vote would carve an exemption in existing laws that require people to report and pay taxes on capital gains.
But Republican Rep. Mark Finchem said buying U.S. gold coins should be exempt, arguing that federal policies have made paper money "virtually worthless.''
"We pretend that it has value," Finchem said. "But every day that we go into deeper debt, that federal reserve note becomes less and less valued. In fact, since 1910 up to today, a dollar bill went from a dollar in value to less than three cents."
Those who oppose the measure believe gold hoarders elsewhere might sell it in Arizona to avoid paying the estate tax.
In 2013, then-Gov. Jan Brewer vetoed a similar bill over concerns that its language might exempt the state from collecting income taxes on such transactions.
And Gov. Doug Ducey has consistently opposed the idea, saying he feared the unintended consequences of such a change.