2024-3-14 07:30 |
The US Government is under backlash after allegedly targeting the crypto mining industry again. A recent report revealed the government’s plan to resurrect a tax proposal that could significantly affect the whole sector.
Leaders in the industry and crypto-friendly US Senator Cinthia Lummis have expressed their concerns on the proposal’s reintroduction.
30% Tax Proposal Rings Crypto Industry’s AlarmsThe US Department of the Treasury recently unveiled its revenue proposals for 2025. Said proposal made the headlines after Pierre Rochard, Vice President of Research at Riot Platforms, suggested that the white house’s budget was bullish on Bitcoin (BTC).
Biden’s administration seemingly had expectations of BTC reaching $250,000 by 2035, according to Rochard’s X (former Twitter) post. As reported by Bitcoinist, Rochard’s claim sparked a discussion on whether the US government had any actual prediction on BTC.
Biden’s 2025 budget proposal anticipates revenue from digital assets and aims to collect over $10 billion from the regulatory and taxation measures listed in the document.
Most notably, the document includes the resurrection of the previously spared tax regulation on crypto mining operations. A year ago, as part of the 2024 Budget, the US Treasury revealed its plan to introduce a 30% tax fee on all crypto-mining operations.
The full implementation of the tax would occur progressively over three years at a 10% increase rate. The first year would excise a tax of 10%, increasing to 20% by the second year and 30% by the third year and onwards.
US Senator Cynthia Lummis noted that the document suggested a “bullish” sentiment from the government on crypto assets. Nonetheless, the US senator considers reintroducing the proposed tax on digital asset mining as potentially damaging to the country’s crypto industry.
Sector Leaders Oppose To The MeasurePerianne Boring, Founder and CEO of the Chamber of Digital Commerce, expressed disagreement with the proposal. In a post, Boring stated that the tax regulation “is another politically motivated attempt to pick winners and losers.”
Bitcoin mining is advancing energy security. The White House’s proposed tax is another politically motivated attempt to pick winners and losers. We will fight to keep innovation in America. https://t.co/ruErEKhYui
— Perianne (@PerianneDC) March 12, 2024
Similarly, the Digital Power Network stated on Tuesday that the tax was a “punitive” and “misguided” attempt to restrain an industry powered by renewable energy.
According to the digital assets coalition, the reintroduction of the proposal “demonstrates a continued pattern from the admin aimed at constraining, if not outright eliminating, the cryptocurrency industry within the US.”
It’s worth noting that the proposal includes miners even if they operate off-grid using renewable energy, as Rochard highlights in an X post. The official document read:
Any firm using computing resources, whether owned by the firm or leased from others, to mine digital assets would be subject to an excise tax equal to 30 percent of the costs of electricity used in digital asset mining.
The crypto community also opposed the US government’s latest step to regulate mining operations. Miners located in the country have already expressed their concerns over the industry’s current landscape as they fought back against previous regulatory measures concerning the disclosure of sensitive data.
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