Proposed 30% cryptocurrency tax removed as part of US debt ceiling deal

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In a favorable turn of events for cryptocurrency miners in the United States, the proposed tax on their electricity consumption has been dropped according to Republican Congressman Warren Davidson.

After lengthy negotiations, an agreement was reached between President Joe Biden and House Speaker Kevin McCarthy to raise the country’s debt ceiling until January 2025, beyond the next presidential election.

The debt ceiling represents the maximum amount of debt the government is allowed to issue. By raising the debt ceiling, the government can borrow more money to meet its financial obligations and prevent a potential default.

Rep. Davidson (R-Ohio) confirmed the proposed crypto tax developments via Twitter on Monday.

Yes, one of the wins is to block the proposed taxes, he said in response to Riot Platforms VP of Research Pierre Rochard, who noted the lack of bitcoin mining in the new project. bill outlining the conditions for raising the debt ceiling.

In early May, the White House suggested a tax on electricity used by cryptocurrency miners called the Digital Assets Mining Energy (DAME) Excise Act. The proposal aimed to impose a 10% tax on miners’ electricity consumption from 2024, gradually increasing to 30% by 2026.

The White House has pointed to the high energy consumption of miners and criticized its negative impact on the environment. He also estimated that the DAME Act would bring in $3.5 billion in revenue over 10 years.

The move drew backlash from many crypto miners, who criticized it as a clear attempt to sideline and sideline the crypto community.

Meanwhile, New York-based Bit Digital said it would protect its operations by expanding to Iceland as a proactive measure against the proposed crypto mining tax.

It is important to note that neither the White House nor the US Treasury has confirmed that the mining tax has been removed. Blockworks has asked for comment.

The White House plan to tax crypto mining is currently on hold, while the debt ceiling agreement awaits House and Senate approval to become law.

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