The Biden administration is pushing Congress to pass a 30% tax on Bitcoin mining
The White House is trying to persuade Congress to pass a 30% climate change tax on cryptocurrency miners as part of its next federal budget.
The change, titled the Digital Asset Mining Energy (DAME) Excise Tax, is designed to encourage mining companies to start taking better account of their so-called “societal damages”, including higher energy prices and greenhouse gas emissions.
Tax Bitcoin Miners
As reported by Yahoo NewsThe President’s Council of Economic Advisers plans to publish a blog post on the White House website on Tuesday justifying the excise tax as an “example of the administration’s efforts to combat climate change and reduce energy prices.”
“For now, cryptomining firms do not have to pay for the full cost they impose on others, in terms of local environmental pollution, higher energy prices and the effects of increased greenhouse gas emissions on the climate,” the CEA said in its post. .
The tax will be phased in over 3 years, starting at 10% in the first year before increasing to 20% and finally 30% in the next two years. Over 10 years, it will generate an estimated $3.5 billion in revenue.
A CEA economist who spoke to Yahoo added that the economic benefits of cryptomining remain “unclear,” while concerns remain over the industry’s financial stability and environmental risks.
Critics of the tax
Bitcoin mining has become unpopular with many left-wing politicians spanning a number of developed countries due to its suspected contribution to climate change through its massive energy consumption. In April 2022, a group of Democratic politicians including progressives like Alexandria Ocasio Cortez signed a letter to the Environmental Protection Agency (EPA) to investigate whether mining companies violated environmental statutes.
Bitcoiners answered with their own letter to the agency the following month, exposing many misconceptions about the harms of Bitcoin mining. Society has generally been strongly opposed to attempts to regulate the mining industry or to change Bitcoin’s code to remove mining from operations.
Critics of Biden’s proposed special tax believe the tax is arbitrarily aimed at specific forms of energy consumption.
“This puts a clear line in the sand that they don’t like the industry. They’re looking for ways to hoard it, Tom Mapes, director of energy policy at the Chamber of Digital Commerce, told Yahoo News. “This is just a way to go after the industry that they don’t support.”
