KEY POINTS
- The bill, if passed, will order the Treasury Secretary to develop a method that allows BTC payments
- Fees similar to credit card payments will apply to the novel tax payment method
- Some crypto users said the bill could drive wider crypto adoption in the country
- Others questioned why they would be willing to give their Bitcoin stash to the government
A Republican congressman has introduced a new bill that could alter the way cryptocurrency users pay their income taxes, signaling increasing interest among lawmakers on ways through which Bitcoin can be integrated into traditional systems. However, many BTC holders are not pleased with the news.
The proposed legislation brought forth by Rep. Matt Gaetz, R-Fla., states that the Treasury Secretary "shall develop and implement a method to allow for the payment with bitcoin of any tax imposed on an individual under this title." The bill seeks to amend the Internal Revenue Code of 1986 to include the novel payment method.
If the bill passes Congress, the Treasury Secretary will also draw up regulations related to: when BTC payments are considered received, requiring "immediate" BTC-to-cash conversions at the end of each transaction, identifying non-tax matters associated with the payments, and ensuring that only the Secretary – no financial intermediaries – will resolve tax matters.
Furthermore, the bill has provisions toward ensuring that rules similar to credit card payments will apply to tax payments using the world's largest cryptocurrency by market value.
Gaetz said empowering taxpayers to use the digital asset for federal tax payments will help drive innovation and improve efficiency in tax payment systems, while also offering more flexible options for American taxpayers.
"This is a bold step toward a future where digital currencies play a vital role in our financial system, ensuring that the U.S. remains at the forefront of technological advancement," he wrote in a statement Tuesday.
The bill received mixed reactions from Bitcoiners and crypto users on X (formerly Twitter). Some were glad Bitcoin was being supported by lawmakers, while others warned against giving their BTC to the state.
Why would I want to give my Bitcoin to government? 🤔
— ₮hΞ Ⓒrypto ₮hΞr₳pist (@kirkdesoto) June 25, 2024
This sounds sketchy
— Jared Loredo (@JaredLoredo) June 25, 2024
No way in hell Im giving btc to the government
— The Truth Is Here (@AliensExist4200) June 25, 2024
It's a step in the right direction, but something about using hard money for this feels off.
— Glue (@GlueNet) June 25, 2024
Several others pointed out that the bill could trigger a "revolution" in the crypto space.
The move is a big step of cryptocurrency💪
— Chinese Whale Lab🐳💎 (@ChineseWhaleLab) June 26, 2024
The are realizing #Bitcoin is the future.
— Financial Index (@financial_index) June 25, 2024
If accepted, it will be a revolution!
— Digvijay Singh Choudhary (@Digvijay_Crypto) June 25, 2024
Gaetz's proposed legislation isn't the first Bitcoin-focused bill. Other bills that seek to encourage wider adoption of the digital asset in traditional systems are waiting in line at Congress.
Earlier this month, Rep. Thomas Massie, R-Ky., introduced the Federal Reserve Board Abolition Act, which seeks to abolish "the Board of Governors of the Federal Reserve and the Federal Reserve banks."
.@RepThomasMassie read The Bitcoin Standard and decided to propose legislation to end the Fed!
— Saifedean Ammous (@saifedean) June 13, 2024
You're welcome, America! pic.twitter.com/989tLvnWG2
He said in a podcast that he "learned some things" while listening to Saifedean Ammous' "The Bitcoin Standard," which then inspired him to draw up the bill to kill the Federal Reserve.
