Updated Crypto Rules Will Raise $4.9 Billion in 2022 and $11 Billion by 2032 in Biden’s 2023 Budget
On March 28, Biden announced his administration’s 2023 budget – a budget that includes modernizing rules for digital assets. Budget documents indicate that such a move would generate $4.9 billion in revenue in 2023.
Additionally, certain financial institutions must report information for the purposes of information exchange.
Certain taxpayers handling foreign digital asset accounts are required to report.
Also, bill note mark-to-market rules can be amended to include digital assets.
According to Yahoo, by 2032, these regulations will generate a total of $10.9 billion, according to the administration.
In an explanation of the proposed changes, the Treasury Department stated that “tax evasion using digital assets is a rapidly growing problem. Since the industry is entirely digital, taxpayers can transact with offshore digital asset exchanges and wallet providers without leaving the United States.”
“In order to ensure that the United States is able to benefit from a global automatic exchange of information framework with respect to offshore digital assets and receive information about U.S. beneficial owners it is essential that United States reciprocally provide information on foreign beneficial owners of certain entities transacting in digital assets with U.S. brokers,” the Treasury said.
In the budget, it is also requested that the Department of Justice (DOJ) invest in building cyber investigative capabilities at FBI field divisions nationwide through investments that support a multi-year effort.
“These investments include an additional $52 million for more agents, enhanced response capabilities, and strengthened intelligence collection and analysis capabilities. These investments are in line with the Administration’s counter-ransomware strategy that emphasizes disruptive activity and combatting the misuse of cryptocurrency,” the budget document read, in part.
As previously reported by GOBankingRates, a provision about the crypto industry was also included in the $1 Trillion Infrastructure Investment and Jobs Act, which was passed in August of 2021.
According to the legislation, $28 billion could be raised in taxes through these new requirements.
As per the text of the bill, the definition of a broker is broadened to include: “any person who (for consideration) is responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person,” per the text of the bill.
Moving forward, the Internal Revenue Service will be tasked to receive information from crypto brokers.
According to CNBC, miners, software developers, stakers, and other individuals who are not customers might not be excluded from this provision.