A bill has been proposed by a Florida lawmaker that would make Bitcoin an authorized method for paying federal taxes in the United States. The bill was introduced by Republican Representative Matt Gaetz on Tuesday, with the aim of allowing American citizens to use Bitcoin (BTC) to fulfill their federal income tax obligations. Gaetz believes that implementing a modernized tax system that incorporates digital currency will lead to increased innovation, efficiency, and will help the U.S. maintain its position as a leader in technological advancement.
According to an official statement from Gaetz’s office, the decision to pursue this legislation was influenced by the lawmaker’s observation of the impact of Bitcoin in El Salvador. Gaetz sees this as a bold move towards a future where digital currencies play a crucial role in the financial system.
El Salvador, under the leadership of pro-crypto President Nayib Bukele, made history by becoming the first country to legalize BTC. Despite facing criticism from the International Monetary Fund and the U.S., the nation has continued to move forward with its BTC strategy and has made significant profits on its investment.
Gaetz’s Bitcoin-for-taxes bill is a novel idea and has not yet been discussed in Congress. However, if the bill progresses, it could follow in the footsteps of Colorado’s state law, which permits tax payments in cryptocurrency. Colorado initiated its crypto tax payment program in late 2022 and is currently the only jurisdiction to have such policies.
Additionally, bipartisan lawmakers have successfully advanced the Financial Innovation and Technology for the 21st Century Act, or FIT 21, which aims to regulate crypto oversight by dividing regulatory responsibilities between the Commodity Futures Trading Commission and the Securities and Exchange Commission.
There are also ongoing efforts by senators Maxine Waters and Patrick McHenry to introduce stablecoin bills that would allow banks and other financial institutions to issue U.S. dollar-pegged tokens.
The departure of the SEC’s head of crypto has raised questions about potential changes in crypto regulation.