Colorado to become first US state to accept cryptocurrency tax payments – The Guardian

Colorado to become first US state to accept cryptocurrency tax payments – The Guardian

Colorado is slated to become the first US state to accept tax payments in cryptocurrency, a move the governor’s office has described as the “next logical step on the path to digital statehood”.

Colorado’s governor, Jared Polis, who announced the effort last week, explained in a tweet that the state would accept crypto payments converted into a dollar value, which would then be deposited in the state’s treasury.

In a recent interview with CNBC, Polis said the payments will be processed by an intermediary and that program is expected to start by the summer. Polis said he hopes to expand the program to include other state business such as driver’s licenses and hunting licenses.

Polis, a former tech entrepreneur, has spoken at crypto conferences, talked to Wired about his ambitions to make Colorado a pioneering state for crypto and even proposed moving the state’s cattle brand system onto the blockchain.

In a statement to the Guardian, Polis’ press secretary, Conor Cahill, called the tax effort the state’s “next logical step on the path to digital statehood”.

“Governor Polis is proud to lead efforts to create a strong and dynamic crypto ecosystem that puts Colorado at the forefront of digital innovation,” Cahill added, pointing out that the state was the very first to employ a “chief blockchain architect” – one of the numerous parties the governor’s office will be working with to process cryptocurrency for taxes.

There might be some concerns, however. According to CNBC, cryptocurrency is considered “property” by the federal government, which means its owners would have to pay taxes on cryptocurrency itself before it can be used as a method of payment. Cahill did not respond to a specific question about whether this might deter some from using cryptocurrency to pay their taxes.

Polis’s announcement was met with mixed reviews on social media.

“It’s also a fantastic way to contribute to the climate change threatening Colorado’s tourism industry! Great thinking!” one user wrote in response to Polis’s tweet.

“I have yet to comprehend crypto. But about homemade chocolate chip cookies? Will Colorado accept that?” wrote another.

Colorado’s move follows efforts in other states to bring crypto into the mainstream. Wyoming is looking into making sales tax payable through cryptocurrency, while Arizona aims to accept bitcoin as legal tender.

New York City’s mayor, Eric Adams, received his first paycheck in cryptocurrency after starting office in January, keeping with a promise he’d made that he would accept his first three paychecks in bitcoin, in …….

Source: https://www.theguardian.com/us-news/2022/mar/01/colorado-tax-payments-cryptocurrency