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Ted Budd (R) of North Carolina is reintroducing a bill in the U.S. House which would put an end to double-taxation for cryptocurrency transactions. The Virtual Value Tax Fix Act would amend the Internal Revenue Code of 1986.
Ted Budd (R) of North Carolina feels that cryptocurrency traders and users are over-taxed, and he’s proposing a bill to put a stop to it. He has even called it a matter of national security.
According to the Internal Revenue Code as it stands now:
“No gain or loss shall be recognized on the exchange of real property held for productive use in a trade or business or for investment if such real property is exchanged solely for real property of like kind which is to be held either for productive use in a trade or business or for investment.”
Yet, the Virtual Value Tax Fix Act would amend this to also include the exchange of cryptocurrencies. Cryptocurrencies would thus be treated similar to the exchange of real property.
Last July, Budd was present in the House’s Ways and Means Committee. It was there that he first made his pitch, and said that the current Internal Revenue Code places a “40% tax rate” on cryptocurrency transaction unfairly. Budd asks: Why is is that foreign currencies fall under tax exemption laws, but cryptocurrencies do not? It is on this basis he has reintroduced the Virtual Value Tax Fix Act.
Budd is part of a growing minority of U.S. representatives who have taken a pro-crypto approach to lawmaking. For example, U.S. Congressman Warren Davidson (R-OH) reintroduced the Token Taxonomy Act in April to exempt utility tokens from securities law. The bill was conceptualized in 2018 and has only in the past few months begun to gain traction.
Even if Budd’s proposed act does not go to a vote, it at least confirms that cryptocurrencies are slowly creeping onto the legislative agenda.
Can we expect milestone legislation for cryptocurrencies sometime in 2019? Let us know your thoughts in the comments below.
Image courtesy of the Washington Examiner.