Washington, D.C. - Today, Congressman Tom Emmer (MN-06) announced the release of a report he commissioned from the Law Library of Congress on the taxation of cryptocurrency around the world. The report was compiled by foreign law specialists and focuses on the tax treatment of new tokens obtained by cryptocurrency mining or staking, otherwise known as "block rewards."
The report is titled "Taxation of Cryptocurrency Block Rewards in Selected Jurisdictions" and reviews the tax treatment of block rewards in 31 countries, as well as the tax implications of cryptocurrency acquired through activities like airdrops and hard forks. The report also compares regulatory approaches to cryptoassets in these countries.
"With the help of the Law Library of Congress, we have a comprehensive overview of the tax treatment and implications in 31 countries around the globe. It is clear that the United States can still be a leader in establishing principles for the proper taxation of digital assets," said Emmer.
"In order for these technologies to thrive and reach their revolutionary potential, we must have the knowledge and organizational landscape of the approaches to regulation to best implement the proper path forward that will not stifle this innovation. We can improve the clarity of IRS taxation while at the same time ensuring these taxes are sensibly applied," Emmer concluded.
“The Library of Congress report contains valuable information on how countries are responding, or failing to respond, to this new technology. How nations tax the people who maintain cryptocurrency networks will obviously have a big effect on attracting or repelling innovators and investment. The results are all over the board, and they show that the U.S. can still establish itself as the global leader through tax policy that is both fair and clear. The critical first step is to clearly establish that block rewards are taxed when the new tokens are sold, like all other new property, and not when they are first acquired. This will both reduce administrative headaches and ensure that people are not overtaxed,” said Abraham Sutherland, Legal Advisor to the Proof of Stake Alliance.
Rep. Emmer is a co-chair of the Congressional Blockchain Caucus and served as the Ranking Member of the House Financial Services Committee Task Force on Financial Technology in the 116th Congress. He is the author of the Safe Harbor for Taxpayers with Forked Assets Act which proposes a prohibition on penalties against taxpayers until the IRS issues guidance on how to report gains or losses of "forked" digital assets.
Read the report here.