Crypto tax: US Senators propose plans to raise billions in revenue

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Senators in the US have reportedly added proposals to expand the taxation of cryptocurrencies to a major bipartisan infrastructure bill in a bid to raise around US$28bn in additional tax revenues.


The proposal will introduce tighter rules on businesses handling crypto as well as widen reporting requirements for brokers. Any digital asset transactions worth more than US$10,000 will also need to be reported to the Internal Revenue Service (IRS), according to a report in Bloomberg Law.


READ: Bitcoin slides as US Senate committee chair pressures SEC to decide on crypto rules


The additional revenues from the crypto tax proposals will be used to partially fund a US$550bn investment in transport and electricity infrastructure that has been hashed out by Republicans and Democrats in Congress as part of a larger US$1 trillion spending package.


The move also comes amid growing scrutiny of crypto and other digital assets in the US from both politicians and regulators after their popularity exploded earlier this year.


Earlier this month, Massachusetts Senator Elizabeth Warren, the chair of the Senate’s Subcommittee on Economic Policy pressured the head of the Securities and Exchange Commission (SEC) Gary Gensler to come up with answers on the crypto market with a view to crafting new legislation to regulate the sector.


Warren also said that the “highly opaque and volatile” crypto industry posed growing risks to consumers and financial markets in general, adding that the lack of regulation governing the market was unsustainable.


The reports appeared to have shaken crypto markets on Thursday, with Bitcoin down 2.2% in the last 24 hours at US$39,694 in early afternoon trading in London, while Ethereum dropped 1.4% to US$2,295.

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