Recently, President Biden said that he will work to make the tax system fair: rules, taxes and eliminating ‘loopholes’ for crypto traders.
See below for full details.
Biden’s new regulations on crypto taxes
As expected, President Biden has made a promise regarding the crypto industry and its traders ahead of his upcoming campaign.
According to the current president, he will work to make the current tax system fair by eliminating tax loopholes for cryptocurrency traders and imposing new taxes.
We know that President Biden previously tweeted that these loopholes cost the government $18 billion in lost tax revenue.
Indeed, for a while cryptocurrency traders were able to evade taxes by exploiting this loophole.
According to a transcript released by the White House on Wednesday, the president said the following:
“We will make the system fair by closing loopholes for cryptocurrency traders and hedge fund managers.”
What are the ‘crypto loopholes’ that Biden is talking about?
Back in May, President Biden hinted at his intention to close loopholes in the cryptocurrency sector. In fact, on his official Twitter account, he had already stated the following:
So, all this is to confirm that, according to Biden, Congress should eliminate “tax loopholes that benefit wealthy cryptocurrency investors”, estimating that these loopholes have led to a loss of around $18 billion in tax revenue.
We also point out that this view was one of his exceptions to a debt deal during the US default crisis. We also note that the crypto ‘loophole’ in question is likely to refer to the ability of traders to sell and buy back cryptocurrencies within short periods of time, thus avoiding higher tax rates.
In any case, it is likely that President Biden will elaborate on his plan to tighten regulation of cryptocurrency traders during his campaign.
Finally, it is interesting to note that following President Biden’s comments, the price of Bitcoin fell by 1.3% to just under $30,000.
Currently, BTC accounts for more than half of the total cryptocurrency market. However, the price has since climbed back above $30,500.
President Biden’s crypto speech at the G7 summit
Recently, President Biden addressed the topic of cryptocurrencies during his speech at the G7 Summit on budget negotiations.
Specifically, he reportedly met with all four Congressional leaders before leaving for the summit and stressed the importance of a bipartisan agreement as the only way forward.
He also stressed his commitment to presenting a proposal to cut spending by over a trillion dollars. Regarding other proposals, Biden stated that many of them were completely unacceptable.
Furthermore, a video released by Sky News shows President Biden talking about cryptocurrencies, saying the following:
“I will not accept a deal that protects wealthy tax dodgers and cryptocurrency traders at the expense of lunch ladies.”
We note that Biden’s statement comes at a time when US regulators are increasing their scrutiny of the cryptocurrency industry.
As such, it is highly likely that there will be no debt deal to protect crypto investors in the country.
Furthermore, the president said he would not accept a $30 billion tax break for the oil industry. He also spoke of the $200 billion in profits the industry made last year, arguing that millions do not need a $30 billion stimulus at the expense of the lives of 21 million Americans.