Two US senators have introduces a bi-partisan bill seeking to exempt Bitcoin and other cryptocurrencies from capital gains taxes. The bill will grant the exemption if the transaction made by the user is under $50.
The bill is the brainchild of Senator Pat Toomey (R), the junior senator representing the State of Pennsylvania and Senator Kyrsten Sinema, the Democrat senator representing Arizona.
Protection from ‘Surprise Taxes’
In a July 27 release, Senator Sinema hinted on the move by protecting Arizonans from what she described as “surprise taxes” to enable them save more. According to the document, the senator said,
“We’re protecting Arizonans from surprise taxes on everyday digital payment transactions so Arizonans can keep more of their own money in their pockets and continue to thrive.”
The bill, named introduced by the senators is focused on the elimination of surprise taxes on Americans when they make payments with digital currencies.
According to the release from the Office of Senator Sinema, Senator Toomey envisages the daily use of virtual currencies for routine payments by Americas.
American Tax Code Yet To Catch Up
The senator, reacting to the bill, said that the country’s tax code is yet to catch up with the developments and pace of the digital currency space.
“The Virtual Currency Tax Fairness Act will allow Americans to more easily use cryptocurrencies as an everyday method of payment by exempting from taxes small personal transactions like buying a cup of coffee,” the senator said.
The focus of the bill is to make sure that small regular payments below $50 are not subject to capital gain tax.
Reactions To The Bill
In their reaction to the bill, a cryptocurrency enthusiast and user in Saratoga California, Dave Chidyllo, described the bill as a waste of time.
Another user, John Malcom expressed concerns over why there should be capital gain tax on purchases made with cryptocurrencies.
“There should be no cap gains on purchases with bitcoin, period. This bill just leaves room for abuse and errors… what if I just make 100 $49 payments?”
A user on Twitter, @fi2023, while reacting to the bill said they wished the threshold was higher.
“I wish the threshold was higher. I would like to have a dedicated wallet to use BTC/lightning at stores and support the network. Would not spend my stash – just load my wallet for weekly shopping.”
An Important Step
Another community member said that it would be an important step for holders of digital assets if the bill passes the scrutiny and gets approved by the senate.
Senator Sinema also worked with Senator Cynthia Lummins (R-Wyo) on the bipartisan U.S. Senate Financial Innovation Caucus that promotes technological innovations that would be of help to the US financial system. It also seeks to find ways that such innovations would boost the financial and global prominence of the US.
