While details of the agreement between President Joe Biden and Speaker of the House Kevin McCarthy on the US debt ceiling were made public on Sunday, a notable part of the agreement appears to have blocked certain taxes proposed by the Biden administration, including the Digital Asset Mining Energy. (LADY) excise tax.
If passed, it would impose a 30% tax on cryptocurrency mining companies, a move the Biden administration said was necessary to limit the environmental and societal harm caused by cryptocurrency mining operations. cash.
Dennis Porter, CEO of bitcoin mining advocacy group the Satoshi Action Fund, wondered if “the administration’s DAME excise tax proposal is gone?” since Bitcoin mining was not mentioned in the text of the bill, dubbed the “Fiscal Responsibility Act 5 of 2023”. US Congressman Warren Davidson (R-OH-08) responded in a Tweeter that, “Yes, one of the wins blocks the proposed taxes.”
The debt ceiling agreement, which is still the subject of intense scrutiny and debate in Congress, comes in the form of a comprehensive 99-page bill to suspend the debt ceiling country through 2025, preventing a federal default, while simultaneously imposing restrictions on government spending.
The Satoshi Action Fund did not immediately respond to Decrypt request for comment.
What is the Digital Asset Mining Energy Tax?
The idea of introducing an energy tax was initially suggested in March this year. Notably, the proposed Digital Asset Mining Energy (DAME) tax would be applicable to both digital asset miners operating on proof-of-work (PoW) networks such as Bitcoin and Proof-of-Stake (PoS) networks like Ethereumregardless of substantial differences in their energy consumption levels.
Under the proposed tax framework, digital asset miners would be required to disclose information such as the amount of electricity they consume, the source of that electricity (whether it comes from renewable sources or not) and its corresponding value. . This requirement would extend to off-grid electricity generation, including the use of otherwise wasted natural gas.
Biden’s 30% Tax on Bitcoin Miners ‘Won’t Happen,’ Says Cynthia Lummis
In a recent report released by the White House, the Biden administration reiterated its position that imposing financial constraints on minors is in the best interests of American communities and the environment.
The proposal, however, has come under fire from crypto advocates.
“Bitcoin mining uses much the same stuff as video games, and no one is calling for them to be banned,” Democratic presidential candidate Robert F. Kennedy Jr. said on Twitter earlier this month. “The environmental argument is a selective pretext to remove anything that threatens elite power structures.”
Republican Senator Cynthia Lummis also lambasted the proposal at the recent Bitcoin 2023 conference, saying a thriving Bitcoin mining industry is not just a national security issue, but also an energy security issue.
While urging Bitcoin enthusiasts to participate in groups that defend the world’s largest cryptocurrency as part of the US economy, Senator Lummis also expressed his belief that the proposed energy tax “does not will not produce”.