US Treasury Releases 2025 Tax Proposal, Cryptocurrency Taxation Similar to 2023 Proposal, Potential Impact on Mining Companies
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Mining Companies May Have to Pay a 30% Electricity Tax
Unified Tax Rules
Mining Companies May Have to Pay a 30% Electricity Tax
The US government may impose a consumption tax on cryptocurrency miners. According to the proposal, the tax rate will be 30% of the mining electricity cost. Mining companies will also be required to report the amount of electricity used for mining, the type of electricity, and its cost.
Assuming that miners use external electricity supply (purchased electricity), they will also be required to pay 30% of the estimated electricity cost as taxes. The proposal claims that the government’s intention to propose a mining tax is driven by environmental considerations due to the significant energy consumption of mining activities.
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Previously, the US Department of Energy (DOE) had requested cryptocurrency mining companies to report their energy consumption for the next six months. However, this investigation has been ordered to be terminated by the US court, deeming it hasty as the Department of Energy skipped specific procedures such as notification and comment periods.
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Judge Rules to Terminate Mining Energy Investigation, Criticizes Hasty Procedures by US Department of Energy
)
Unified Tax Rules
The government also aims to further unify tax rules. Currently, if losses occur from holding cryptocurrency assets, they can still be deducted according to different tax rules than stocks or securities. The government proposes that all digital assets should follow the same tax rules as stocks and securities.
The majority of the proposal aligns with the cryptocurrency tax policies introduced by the Biden administration in 2023, but the proposal has not been formally passed.
During the G7 summit, President Biden explicitly stated that wealthy tax evaders and cryptocurrency traders would not be protected in tax policies, which could jeopardize food assistance for nearly one million Americans.
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Biden Calls Out Cryptocurrency Trading at G7, Tax Policies Cannot Compromise
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Cryptocurrency Taxation
Mining Companies
Further Reading
Are Mining Company Stocks Being Replaced? Research Institutions: Investors Are Going Long on Bitcoin ETFs and Short on Mining Stocks
Bitcoin Surge Spurs Mining Frenzy, US Department of Energy Requires Energy Reports from Mining Companies