Sen. Cynthia Lummis discussed the prospect of a 30% excise tax on Bitcoin miners proposed by President Joe Biden during a fireside chat at the Bitcoin 2023 conference in Miami. Addressing concerns raised by Chamber of Digital Commerce founder and CEO Perianne Boring, Lummis stated that such a tax is unlikely to happen, arguing that it would negatively affect not just Bitcoin mining but also the country’s national security.
Recognizing that mining opportunities exist globally, Lummis pointed out that promoting Bitcoin mining within the United States is an important aspect of maintaining both national and energy security. Wyoming, in particular, houses a diverse energy sector featuring a mix of mining, oil, gas, solar, and wind production. The state senator believes this paints a promising picture for Bitcoin miners, as they can effectively utilize excess energy resources. In her view, this process is helping clean up the environment.
However, convincing lawmakers of the benefits of Bitcoin mining has proven to be a difficult task. Persistent worries regarding its potential usage in criminal activities have impeded progress in legislation, as have certain state-level policies. For example, Texas recently implemented a cap on miners’ ability to earn energy credit. Nonetheless, Lummis remains hopeful that future efforts in education can sway lawmakers towards a better understanding of the industry.
Earlier this year, a Biden administration report explored the impact of a 30% excise tax on American cryptocurrency mining operations. It concluded that implementing the tax would be advantageous for both communities and the environment. Despite its optimistic outlook, many in the Bitcoin community are wary of unfavorable tax policy decisions.
In fact, the current infrastructure bill, which proposes the Digital Asset Mining (DAME) tax, has further strained the relationship between the crypto industry and U.S. lawmakers. This proposal encompasses a broad definition of brokers, which would also include miners and necessitate disclosing tax-related data to the IRS.
As a countermeasure, Sen. Lummis encouraged Bitcoin enthusiasts to actively participate in advocacy groups promoting the digital currency as an integral part of the national economy. She also urged the community to establish open communication with their government representatives to better express their concerns and desires for the future of the cryptocurrency space.