Supporters of the crypto industry in the U.S. Senate filed an amendment to the bipartisan infrastructure bill to make clear that miners and providers of crypto services would not be required to follow new tax-reporting rules on crypto brokers.
The amendment would “clarify that ‘brokers’ mean only those persons who conduct transactions on exchanges where consumers buy, sell and trade digital assets,” according to a press release.
That means that the IRS will not be able to require that miners, stakers and companies that sell hardware or software for storing digital assets report the activities of their customers or crypto users whose transactions they verify.
It also exempts developers who create digital assets from monitoring their use if the users are not their customers.
The amendment was introduced by Democratic Sen. Ron Wyden of Oregon and Republican Sens. Cynthia Lummis of Wyoming and Pat Toomey of Pennsylvania.
In a statement, Wyden said that “investors failing to pay the tax they owe through cryptocurrency is a real problem,” but that the law as previously written was too broad and would have applied to actors who would not have been able to fulfil its mandates.
“Digital assets are here to stay,” Lummis said in the press released. “While much more work needs to be done, this amendment is a responsible step toward fully incorporating digital assets into the U.S. financial sector.”
In a note to clients, Beacon Policy Advisors analysts wrote that the changes should not threaten a reduction in the $28 billion tax lawmakers expect the policy to raise over ten years to fund the infrastructure bill.
“The refined scope of the amendment has raised questions about a possible decrease in expected revenue from crypto reporting, but we believe the $28 billion pay-for will be unchanged,” they wrote, adding that the amendment will likely be considered by Saturday, while the entire infrastructure package will be voted on “by early next week.”
Crypto assets were trading higher Wednesday afternoon, with bitcoin BTCUSD, -0.68% up about 3.8% and ether ETHUSD, -0.55% rising roughly 8%.