Bitcoin Miners In The US Will Be Taxed 30 Percent

The US government raises taxes for Bitcoin mining. (Photo; Doc. MuscleGeek)

JAKARTA - The White House views the Bitcoin mining industry as an activity that is environmentally detrimental and limited in economic benefits. As part of the next federal budget, the White House is trying to convince Congress to impose a 30 percent climate change tax on cryptocurrency miners.

This change, named the Digital Asset Mining Energy band (DAME), is designed to encourage mining companies to start considering the "social loss" they cause, including higher energy prices and greenhouse gas emissions.

As reported by Yahoo News, the president's Council of Economic Advisors plans to issue a blog post on the White House website on Tuesday that justifies the band tax as an example of Administration's efforts to counter climate change and lower energy prices".

"Currently, cryptocurrency mining companies don't have to pay the full cost they impose on others, in the form of local environmental pollution, higher energy prices, and the impact of increasing greenhouse gas emissions on climate," the CEA wrote in its post.

Taxes will be implemented in stages for 3 years, starting from 10 percent in the first year before rising to 20 percent and finally 30 percent in the following two years. Over the next 10 years, the tax is expected to generate revenue of USD 3.5 billion (IDR 51.5 trillion).

A CEA economist who spoke to Yahoo added that the economic benefits of crypto mining remain "unclear", while concerns are still lurking about financial stability and risks to the industrial environment.

Bitcoin mining has become unpopular for many left-wing politicians in many developed countries because of its alleged contribution to climate change through large energy consumption. In April 2022, a group of Democrat politicians including progressives such as Alexandria Ocasio Cortez signed a letter to the Environmental Protection Agency (EPA) to investigate whether mining companies violate environmental laws.

Bitcoin supporters responded with their own letter to the agency the following month, denying various misunderstandings about Bitcoin mining losses. The community generally strongly opposes efforts to regulate the mining industry or change the Bitcoin code so that mining is removed from its operations.

Critics commented on the Bitcoin mining tax proposed by the Biden administration. They believe that the costs are randomly targeting certain forms of energy consumption. "This places a clear line that they don't like this industry. They are looking for ways to hinder it," said Tom Mapes, director of energy policy in the Digital Chamber of Commerce.