US Lawmakers Introduce ‘Virtual Currency Tax Fairness Act’ To Boost Use Of Cryptocurrency For Payments Cryptocurrency
Several U.S. lawmakers have introduced the Virtual Currency Tax Fairness Act to bolster “the legitimacy of cryptocurrency in our digital economy.” The bill also aims to expand the use of cryptocurrencies for payments.
Virtual Currency Tax Fairness Act introduced in the United States
On Thursday, Representatives Suzan DelBene and David Schweikert introduced the “Virtual Currency Tax Fairness Act of 2022.” The bipartisan bill is co-sponsored by Congressmen Darren Soto and Tom Emmer.
The bill “would create a workable structure for taxing purchases made with virtual currency, also known as cryptocurrency,” the lawmakers explained. It will also expand the use of cryptocurrency for payments and further strengthen “the legitimacy of virtual currency in our digital economy.”
Current legislation stipulates that any crypto gain must be reported as taxable income, regardless of the size or purpose of the transaction, the lawmakers pointed out, noting that “this includes purchases as small as the purchase of a Cup of coffee”.
Claiming that the existing law “makes everyday use of virtual currency nearly impossible, discouraging people from using it and inhibiting the growth of our digital economy,” lawmakers detailed:
The Virtual Currency Tax Fairness Act would exempt personal transactions made with virtual currency when the earnings are $200 or less.
Jerry Brito, executive director of cryptocurrency think tank Coin Center, explained, “Today you need to track and report every transaction you make using them, whether it’s an investment of $10,000 or whether you buy a 99¢ song online or a latte at a coffee shop. He precised :
This obviously creates friction and puts cryptocurrencies at a disadvantage compared to other digital payment methods.
The bill “would treat cryptocurrencies the same way foreign currencies are currently treated,” Brito noted.
Representative DelBene commented:
Outdated regulations regarding virtual currency disregard its potential for use in our daily lives, instead treating it like a stock or an ETF.
“This sensible bill reduces bureaucracy and opens the door to new innovations, which will ultimately grow our digital economy,” she concluded.
What do you think of the Virtual Currency Tax Fairness Act? Let us know in the comments section below.
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