US lawmakers call for change in corporate digital asset taxes

Two US senators are calling on Treasury Secretary Scott Bessent to “exercise [the department’s] authority” and change a provision affecting taxes on corporate holdings of digital assets.

In a May 12 letter, Senators Cynthia Lummis and Bernie MorenosuggestedBessent had the authority to change the definition of “adjusted financial statement income” under existing US law in a way that could reduce what digital asset companies pay in taxes. The proposed adjustment was suggested as a way to modify a provision of the Inflation Reduction Act, signed into law in 2022.

“Our edge in digital finance is at risk if US companies are taxed more than foreign competitors,”saidLummis in a May 13 X post.

According to the two senators, the proposed modification would provide “relief to corporations that invest in digital assets.” Lummis has been one of the most outspoken digital asset advocates in Congress, while Moreno took office in January after crypto-backed political action committeesspent roughly $40 millionto support his 2024 Senate race.

Related:Arizona governor kills two crypto bills, cracks down on Bitcoin ATMs

The Inflation Reduction Act, which went into effect in 2023, imposes a 15% minimum tax on companies that report more than $1 billion in profits for three consecutive years. The measure would seemingly include unrealized crypto gains and losses, leading to Lummis’ and Moreno’s calls for the Treasury Department to “act swiftly.”

Senate awaiting second vote on stablecoin bill

The call from the two senators came as lawmakers in the Senate areexpected to consider another voteon the Guiding and Establishing National Innovation for US Stablecoins, or GENIUS Act — legislation to regulate payment stablecoins in the US. A motion for considerationfailed to move forwardin the Senate on May 8 due to Democratic lawmakers pushing back on Donald Trump’s ties to the crypto industry.

Lummis, one of the bill’s co-sponsors,suggestedthat she would continue to support digital asset regulation. The Senate could take up another vote in a matter of days.

Magazine:Best and worst countries for crypto taxes — plus crypto tax tips

Explore more articles like this

Subscribe to the Markets Outlook newsletter

Get critical insights to spot investment opportunities, mitigate risks, and refine your trading strategies. Delivered every Monday

By subscribing, you agree to ourTerms of Services and Privacy Policy