By Michael Scott
The US House of Representatives is set to debate a bill introduced by Florida’s Representative Matt Gaetz to enable federal income tax payments using Bitcoin. The bill could influence the intersection of government finance and crypto.
The proposed legislation sponsored by the American lawyer seeks to amend the Internal Revenue Code (1986) to integrate the new payment method. The passing of the bill will mandate the Treasury Secretary to initiate the development and implementation of a compatible system that would accept Bitcoin payments to settle individual federal taxes.
Proposals to Amend Internal Revenue Code
The system that the Treasury should implement should prioritize addressing vital aspects such as indicating receipts of Bitcoin payments. Also, the system should offer immediate Bitcoin conversion to the dollar equivalent when the party completes the transaction.
Representative Gaetz proposes the Internal Revenue Service exercise authority and enter into contracts involving the receipt of Bitcoin payments. The bill outlines rules that mirror those governing credit card payments and the fees attributed to such services.
The proposal captures provisions to address confidentiality and liability by replicating the rules governing alternative payment methods. The approach targets a seamless introduction of Bitcoin as a payment option to avoid compromising taxpayer protections.
A press release by Rep Gaetz explained the move to add Bitcoin payment options when settling income tax dues, which seeks to encourage innovation and efficiency for US taxpayers. In particular, it offers more ways to pay their obligations.
Gaetz hailed the bill as a bold step towards integrating digital currencies to play a critical role in the financial system. The addition of Bitcoin payments will catapult the US to the forefront of crypto and technological advancement.
Rep. Gaetz Support for Bitcoin
The bill’s introduction is notable given that Rep. Gaetz recently toured El Salvador during the second inauguration of pro-bitcoin advocate President Nayib Bukele. The country had, in 2021, adopted Bitcoin as the nation’s legal tender in a move that sparked global inquiry regarding crypto roles within the national economies.
The legislative proposal identifies with the increased interest in crypto and support for cryptocurrency within the political circles. Republican presidential candidate Donald Trump and an ally of Rep Gaetz announced support for Bitcoin and accepted the crypto for his campaign donations.
Trump vowed to end the war targeted on crypto by the Joe Biden-leaning regulatory agencies. He added that the US will become the crypto future besides future Bitcoin mining predominantly in the US.
The pro-crypto stance by Trump has prompted Democrats to relinquish the historical animosity toward crypto. President Biden is easing on the crypto as the policies now become a wedge issue in this year’s election.
Biden officials have indicated an intention to attend the upcoming Bitcoin roundtable discussion hosted in Washington, DC. The Biden administration reportedly rehired the crypto advisor who decried the regulation-by-enforcement approach deployed by the Securities and Exchange Commission (SEC).
The bill’s introduction portrays efforts to onboard the adoption of crypto to mainstream adoption in the United States. The bill’s passage will yield a major shift in the federal government’s interaction with cryptocurrencies.
The bill has the potential to pave the way for Bitcoin’s broader acceptance and integration of crypto within official financial transactions.