Revenue departments of two US states Colorado and Utah introduced programs that will permit taxes to be paid in cryptocurrency


A program that will enable individuals and businesses to pay their tax bills with virtual
currencies, such as Bitcoin, Ethereum, and Dogecoin is being introduced by the revenue
departments of a pair of rocky mountain the US states Colorado and Utah targeting implementation within a few months.
Beginning Jan. 1, 2023, state and local governments will be able to
accept crypto for tax payments under the Utah state legislature's H.B. 456. In
addition, the law requires that the Division of Finance contract with a third
party like a cryptocurrency payment
gateway to expeditiously cryptocurrency into dollars conversion time before
remitting them.
In Colorado,
crypto advocate Governor Jared Polis urged the Department of Revenue to develop
a program for accepting cryptocurrency tax remittances. It is still working
through some of the details and the government is planning to have a special
crypto payment portal up and running for taxpayers to use by September. To
immediately exchange the cryptocurrency into U.S. dollars, Colorado is also planning
to hire a third party. “We are working to make it similar to how we accept
credit cards and other forms of payment,” said department spokesperson Meghan
Tanis.
There are some
logistical hurdles to overcome before the program launches in two Western states
due to the sector's selloff.
During the 2022
legislative session, around 37 states considered the bills affecting certain aspects
of cryptocurrency said Heather Morton, who is a policy analyst at the National
Conference of State Legislatures. Several states have considered bills
authorizing authorities to accept cryptocurrency, including Arizona,
California, Hawaii, Illinois, Louisiana, New York, and Oklahoma. Even though many
states were supporting following Colorado and Utah's lead, economists, academics
and crypto skeptics are giving warning to lawmakers against initiatives that
could harm state treasuries and taxpayers.
Currently before
the California Legislature, Betty Yee, California's state controller, called a
crypto-payment bill (S.B. 1275) as “fiscally irresponsible,” highlighting the
price volatility for cryptocurrencies and lack of a robust federal regulatory
framework for digital assets.
John Valentine,
chairman of the Utah State Tax Commission said that in Utah's program, state
money would not be at risk during cryptocurrency conversions. He further added
that it may be difficult to find a vendor who is willing to absorb the risk.

Indrani bose
CBW - External Analyst
INDIA