US President signs infrastructure bill, senators respond with proposal to protect crypto industry
US President signs infrastructure bill, senators respond with proposal to protect crypto industry By Hannah Perez

Following the final enactment of the infrastructure bill, Senators Ron Wyden and Cynthia Lummis have introduced a legislative proposal to protect the crypto industry from the controversial tax provision

.

***

U

.S. President Joe Biden signed the bipartisan USD $1 trillion infrastructure bill

into law on Monday this week, which contains a controversial tax filing requirement for cryptocurrencies.

Biden’s signature comes after the US House of Representatives passed the bill last week. As we reported on DiarioBitcoin

, the new legislation is part of an extensive funding plan that will allocate funds to improve the public transportation system, expand broadband, as well as invest in other public services and construction projects.

We’re finally getting it done,” Biden said at the event, referring to years of failed attempts in Washington to pass such a large bill. “So my message to the American people is this:America is moving again and your life is going to change for the better

,” the president added.

Infrastructure bill includes controversial crypto provision

Likewise, the bill also aims to raise USD $28 billion in crypto taxes to fund infrastructure projects across the country through an expansion of tax requirements for digital currencies. In particular, the regulation expands the definition of ‘broker’ for Internal Revenue Service purposes, requiring them to report all crypto transactions.

The provision has been widely controversial, raising concerns among the cryptocurrency enthusiast community as the language of the document has been unclear. Experts have pointed out that, as expressed in the legislation, the concept of ‘broker’ could encompass miners, wallet developers, node operators and other parties who do not actually facilitate transactions and who therefore would not be able to file tax reports in compliance with the law.

See also  Shiba Token: maxi event on July 20th and 21st (with NFT and mega-party!)

Meanwhile, another controversial provision for the crypto industry requires recipients of transactions over USD $10,000 to verify the sender’s personal information. They must also provide other information such as Social Security number, indicate the nature of the transaction, as well as report it to the government within 15 days.

Some lawyers have asserted that when applied to cryptocurrencies and other digital assets such as non-fungible tokens (NFTs), it would be nearly impossible to comply with the law, as reported by CoinDesk citing a <a href=”https://www.proofofstakealliance.org/wp-content/uploads/2021/09/Research-Re

port-on-Tax-Code-6050I-and-Digital-Assets.pdf” target=”_blank” rel=”noopener”>recent research.

In response to the final enactment of the infrastructure bill, a group of U.S. lawmakers have introduced a proposal that seeks to protect the crypto industry.

Senators seek to shorten the scope of ‘corridor’

As reported by Bloomberg, Senators Ron Wyden, chairman of the Senate Finance Committee, and Cynthia Lummis, an energetic cryptocurrency advocate, are introducing a bill to amend the controversial tax reporting requirement provision in the infrastructure bill.

According to the report, the legislative proposal seeks to narrow the scope of the term ‘broker’, which could be interpreted too broadly experts have noted, to the point that it could stifle innovation and growth in the crypto industry. Senator Wyden explained in a statement quoted by Bloomberg:

‘Our bill makes clear that the new reporting requirements do not apply to people developing Blockchain wallets and technology. This will protect American innovation while ensuring that those who buy and sell cryptocurrencies pay the taxes they already owe.

This isn’t the first attempt by lawmakers – and the crypto community – to amend the controversial provision. In August, two groups of senators came together to introduce an amendment to shorten the scope of the term ‘broker’. However, the proposal failed to win a unanimous Senate decision and the infrastructure bill passed without reforms to the House of Representatives.

See also  Tezos to deliver smart contracts for leading European banks

According to Bloomberg, it is still unclear when the bill to reform the crypto reporting provision could come up for a vote, or whether it could be included in other year-end legislative packages in the coming weeks. Although, he notes that the proposed amendment includes a provision that would make it retroactive to the signing of the infrastructure bill.

Recommended Reading

Sources: CNBC, Bloomberg, CoinDesk, Bitcoin Magazine, archive

Version by Hannah Estefania Perez / BitcoinDaily

Image by Unsplash