US Debt Ceiling Prevents 30% Bitcoin Mining Tax

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Last Updated on May 30, 2023 by Bitfinsider

As the details of the agreement between President Joe Biden and House Speaker Kevin McCarthy on the U.S. debt ceiling became public on Sunday, a notable aspect of the deal appears to have blocked the Digital Asset Mining Energy (DAME) excise tax proposed by the Biden administration.

The bill, if enacted, would impose a 30% tax on cryptocurrency mining companies, a move the Biden administration argued was necessary to limit the environmental and societal damage caused by cryptocurrency mining operations.

Pierre Rochard, vice president of research at Riot Platforms, questioned whether “the Administration’s DAME excise tax proposal is gone?” Given that Bitcoin mining was not mentioned in the bill’s text, it was titled the “Fiscal Responsibility 5 Act of 2023.” Rep. Warren Davidson (R-OH-08) replied via Twitter, “Yes, one of the victories is blocking proposed taxes.”

The debt ceiling agreement is a comprehensive 99-page bill that aims to suspend the nation’s debt limit until 2025, thereby preventing a federal default, while concurrently imposing restrictions on government spending. It is still subject to thorough scrutiny and debate in Congress.

During the recent Bitcoin 2023 conference, Republican Senator Cynthia Lummis also criticised the proposal, stating that a prospering Bitcoin mining industry is a matter of both national security and energy security.

Senator Lummis urged Bitcoin enthusiasts to join organisations that advocate for the world’s largest cryptocurrency to be incorporated into the U.S. economy, but he also expressed confidence that the proposed energy tax “won’t happen.”

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