US Senate Yet to Reach Decision Over Proposed Crypto Tax Bill

UTC by Tolu Ajiboye · 3 min read
US Senate Yet to Reach Decision Over Proposed Crypto Tax Bill
Photo: Shutterstock

The Federal lawmakers plan to vote on Tuesday over the original crypto tax bill as a potential source for generating $28 billion infrastructure funding.

Recent senate deliberations over the crypto tax bill ended without amendment as the House looks to a final decision. The core of the provisions is to raise $28 billion for infrastructure spending through taxation of digital assets. It also seeks to impose expanded third-party reporting requirements on any crypto firm with a ‘broker’. This means that even stakers and miners may be subject to these third-party reporting requirements. In addition to this, software developers and other network validators could also be affected.

The Senate voted with 29 against and 68 in favor of halting the House debate on the provisions. However, there is a rule that allows senators to deliberate on a bill for up to 30 hours before voting on it. 

The impending decisive voting exercise slated for Tuesday is very crucial as it could potentially have ripple effects throughout the crypto space. However, it is worth noting that the Senate could unanimously decide to amend the bill currently under consideration. Jake Chervinsky, general counsel to Compound Finance, said the bill amendment could take place before Tuesday’s final voting process.

According to Chervinsky, “The Senate has voted 68-29 to end debate. We wanted a vote on the Wyden amendment first, or on a Wyden-Warner compromise, but no luck. The Senate has to wait until Tuesday to do a final vote. They might still amend the bill before then.”

Industry Reactions to the Crypto Tax Bill

Unsurprisingly, the crypto space is unhappy with some of the specifics in the bill. The sector is supporting an amendment proposed by Senators Pat Toomey, Rob Wyden, and Cynthia Lummis regarding the bill’s third-party reporting requirements. This amendment seeks to exempt miners, validators, and software developers from the bill’s provisions. The argument is that the aforementioned individuals do not have personal information on their counter-parties and are therefore not liable.

Notably, there is a competing amendment from Rob Portman, Mark Warner, and Kyrsten Sinema. This parallel proposal only exempts miners, proof-of-stake validators, and wallet providers from the bill and has the support of most lawmakers.

Cynthia Lummis has also weighed in on the current 30-hour deliberations. On August 8th, the senator from Wyoming tweeted that although “some senators want to keep focusing on the infrastructure bill for 30 hours to raise awareness about its price tag,” others are more concerned about other pressing legislation matters. She was referring to Senate Majority Leader Chuck Schumer, adding that he “wants to quickly vote in order to focus on other legislation, and won’t allow amendment votes unless that happens.” Lummis ended on a reassuring note for the crypto space, saying that the outcome of the voting amendments would please the “digital asset community.”

The legislation still has some way to go before becoming law, even if the Senate passes it on Tuesday. It would need to clear the House, which would allow for additional revisions along the way.

Cryptocurrency News, News
Related Articles