US Congress Omit Contentious Crypto Mining Tax from Latest Fiscal Responsibility Bill

US Congress Omit Contentious Crypto Mining Tax from Latest Fiscal Responsibility Bill

The highly controversial Digital Asset Mining Energy (DAME) excise tax was not included in the latest Fiscal Responsibility bill to tackle the Debt Ceiling crisis. The proposed 30% tax on energy costs for cryptocurrency miners drew widespread criticism from stakeholders within the crypto-mining sector and US lawmakers. The omission of the tax has been widely celebrated on Crypto Twitter, as it was seen as a victory for the broader crypto industry. US Congressman Warren Davidson confirmed the absence of the DAME tax in the debt ceiling bill and revealed “one of the victories is blocking proposed taxes” on Twitter. Cryptocurrency markets responded favorably to this development, with Bitcoin showing a 7% increase before Monday trading.

Background of the DAME Tax

The DAME excise tax proposal aimed to address the energy consumption associated with digital asset mining. The Department of the Treasury stated that this increased energy consumption has adverse environmental effects, can increase energy prices for those sharing an electricity grid with digital asset miners, and can pose risks to local utilities and communities. However, the tax faced strong opposition from crypto advocates and several US lawmakers. Removing the DAME tax from the debt ceiling bill does not mean the debate surrounding energy costs and cryptocurrency mining ends. It is still uncertain whether a similar tax proposal might be reintroduced in a future bill. Furthermore, it remains unclear how future discussions might influence the cryptocurrency industry in the US.

Impact on the Broader Crypto Industry

While removing the proposed DAME tax is undoubtedly a victory for crypto miners, the ongoing uncertainty surrounding future legislation may pose challenges. Moreover, although the crypto community has embraced the omission of the tax from this current bill, there has been no communication to suggest that it has been abandoned. Instead, much of the conversation has risen from Rochard’s Twitter comments, a representative of an American Bitcoin miner who would be impacted by the tax passing into law. Rochard’s most recent tweet has over 120,000 views since its publication early May 29.

The latest version of the debt ceiling bill, known as the “Fiscal Responsibility Act of 2023,” includes various other provisions, including a two-year extension of the debt ceiling, non-enforceable funding targets for future years, and specific changes to SNAP food assistance and Temporary Assistance for Needy Families (TANF) programs. Looking ahead, it remains to be seen how these new developments will impact the broader crypto industry.

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