Elon Musk Calls Senate Crypto Tax Provision a ‘Hasty Legislation’

Jafrin  |  Aug 7, 2021

The crypto community received support from Tesla and SpaceX CEO Elon Musk against Portman’s amendment to the crypto tax provision in the U.S. Infrastructure Bill that could potentially decide the fate of crypto businesses in the U.S.

Elon Musk Remarks Over Crypto Tax Provision Amendment

The latest amendment to the crypto taxation provision by Senators Rob Portman and Mark Warner made at the last minute only excludes Proof-Of-Work validators and developers from the impossible tax reporting criteria.

Responding to this, Coinbase CEO Brian Armstrong wrote in a 10-tweet thread directed at Portman-Warner amendment, saying:

"At the 11th hour, @MarkWarner has proposed an amendment that would decide which foundational technologies are OK and which are not in crypto. This is disastrous."

According to him, proof of stake validators complying with the rules while excluding proof of work miners is asking for “the impossible.” At the same time, it would require Coinbase and other exchanges to surveil their customers' transactions even more closely than traditional financial services.

Crypto Tax Bill Amended Over the Last Minute

The U.S. Infrastructure Bill has been estimated to be over $1 trillion with a crypto taxation provision that would implement a $28 billion tax burden on the crypto ecosystem. If passed, the bill would require crypto brokers to report tax liabilities to the IRS.

The definition surrounding brokers includes software developers, node operators, miners, where the subjects can not practically comply with crypto tax reporting obligations as they don’t have the required information.

After several calls for amendments to the flawed bill, a proposal was made by Senators Ron Wyden, Cynthia Lummis, and Pat Toomey on Aug 4 that excludes miners, developers, validators, and protocol developers from tax reporting. On the other hand, the recent proposal by Sen. Rob Portman and Mark Warner only excludes Proof-Of-Work validators and developers from the impossible tax reporting criteria.

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