In line with President Joe Biden’s plans, the US Treasury Department once again suggests a series of tax rules related to digital assets, including banning wash-trading and imposing an excise tax on electricity costs for miners.
Treasury released its 2025 revenue proposals on Monday, known as the “Green Book,” which outline the fiscal recommendations in Biden’s budget, also released Monday.
The cryptocurrency-related proposals are largely a repeat of what the President called for in 2023, which ultimately did not become law.
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The Department wants to add an excise tax on “any company that uses computing resources… to mine digital assets” equal to 30% of the costs of electricity used for mining. If the proposal were adopted, miners would be required to report the amount and type of electricity used and the cost, if purchased externally.
Miners who rent equipment would also be responsible for reporting electricity values, and companies using off-grid power would have to pay 30% of the estimated costs.
The Biden administration first proposed the excise tax on miners last year, citing environmental concerns.
“Although crypto assets are virtual, the energy consumption tied to their compute-intensive production is very real and imposes very real costs,” the White House said in a May 2023 statement.
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Treasury officials also want to see wash-trading rules applied to cryptocurrencies, closing a long-standing loophole that Democrats have long been trying to close.
“A taxpayer may sell at a loss a digital asset that is not considered a security or security for fire sale purposes on one day and repurchase the same digital asset the next day,” Monday’s Greenbook reads. “The same loss recognition rules that would apply to stocks and shares should apply to digital assets held as investments or for trading.”
Treasury suggests adding all “digital assets,” not just crypto securities, to the current wash trading rules.
The Department defines “digital asset” as “any digital representation of value recorded on a cryptographically protected distributed ledger or any similar technology as specified by the Secretary,” according to the Greenbook.
