The Arizona State Senate is currently considering a bill where voters will decide whether digital currencies need to be exempt from property taxation. The bill introduced during the first session of the 2023 Senate seeks to amend the state’s constitution concerning property taxes.
Arizona could exempt crypto from property taxes
Senators Justine Wadsack, Sonny Borrelli and Wendy Rogers introduced the legislation in question. The senators proposed having the residents of Arizona decide on amending the state’s constitution in relation to property taxes.
If this measure passes the legislature, the voters will be given a chance to choose in November 2024 when they should create a virtual currency. Virtual currencies are tokens that do not represent the US dollar or any other foreign currency.
The constitution of Arizona requires that federal, state, country, and municipal properties be exempted from paying taxes. The same applies to most household goods, public debts, and other products.
The bill in question has been named SCR 1007, and it has undergone two readings according to the Arizona State Senate calendar requirements. The two readings happened on January 19 and January 23.
The Arizona state Senate has previously drafted bills focused on the cryptocurrency industry. In 2018, the lawmakers tabled a bill permitting residents to make tax payments in cryptocurrencies. However, the bill was vetoed by the Arizona governor at the time, Doug Ducey. In 2022, Senator Roger also tabled a crypto-related bill.
The recently tabled bill comes in the wake of newly elected leaders, and it will set precedence on how these lawmakers will shape the state’s crypto framework in the coming years.
In the United States, the purchase or sale of cryptocurrencies is subject to capital gains tax at the federal level. However, states can formulate their policies on crypto and taxes.
Some states where crypto adoption is high are Alaska and Florida, allowing residents to make tax payments using cryptocurrencies. The states that exempt crypto from capital gains taxes include Alaska, Texas, Washington, Wyoming, Tennessee, South Dakota, Nevada, and New Hampshire.
US states focused on crypto adoption as the federal government drags its feet
US states have been making significant progress in coming up with legislation targeting cryptocurrencies. The same level of progress has not been seen at the federal level, where regulatory bodies such as the Securities and Exchange Commission (SEC) are facing criticism for the lack of regulatory clarity.
While regulations on crypto trading activities are still lacking, crypto mining is fast gaining traction. States like Texas have emerged as leaders in Bitcoin mining after attracting many crypto-mining companies.
The main criticism surrounding Bitcoin mining activities in the US is the high energy demand. However, a subsidiary of Talen Energy recently installed a nuclear power station in partnership with a Bitcoin mining company. Using nuclear energy to mine BTC could put a rest to the criticism and trigger growth in mining activities.
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