On December 28, 2012 the Tennessee DOR issued Ruling 12-110 attempting to clarify its rule on the taxation of gold and silver bullion. I’m not sure that it hit the mark, though.
TN, like most states, does not tax currency transactions when they are completed based on the explicit value of the coin or currency. When the exchange or the price is based on the intrinsic value of the item then it is a taxable sales of personal property. The most compelling evidence that an item is being sold based on “intrinsic” value is when the price varies according to weight and not its value established by the government. As I read this opinion, then, a $20 gold coin sold for $1800 because of its weight would be considered a taxable transaction subject to 9.25% TN Sales tax. http://www.tn.gov/attorneygeneral/op/2012/op12-110.pdf
Other states, like Georgia, address this in a rule that excludes gold and silver transactions unless they are in the form of jewelry or art or other “objects”. However, given this ruling it may open the door for other states to reexamine their historical practices on the taxation of these types of transactions. I think most of these rules were written when the price of gold and silver was much lower and maybe closer in price to the face value of the coin being exchanged.