As part of the upcoming federal budget, the White House is aiming to persuade Congress to levy a 30% climate change tax on bitcoin miners. The measure, known as the Digital Asset Mining Energy (DAME) excise tax, is intended to push mining companies to start accounting for their so-called “societal harms,” such as higher energy prices and greenhouse gas emissions.
According to Yahoo News, the president’s Council of Economic Advisors will write a blog post on the White House website on Tuesday defending the excise tax as an example of the Administration’s efforts to fight climate change and reduce energy prices.
“Currently, crypto mining firms do not have to pay for the full cost they impose on others, in the form of local environmental pollution, higher energy prices, and the impacts of increased greenhouse gas emissions on the climate.”the CEA stated in its post.
The tax would be phased in over 3 years, starting at 10% in the first year before rising to 20% and eventually 30% in the following two years. Over 10 years, it would generate an estimated $3.5 billion in revenue.
A CEA economist from the White House added that the economic benefits of crypto mining remain “unclear,” while concerns still loom about the industry’s financial stability and environmental risks.
Bitcoin Mining Community Criticizes White House Tax Proposal
Bitcoin mining has been unpopular among many left-wing politicians across many industrialized nations because of its suspected contributions to climate change through its vast energy consumption. In April 2022, a group of Democratic legislators wrote a letter to the Environmental Protection Agency (EPA) requesting that the agency examine whether mining companies were breaching environmental laws.
The next month, Bitcoiners reacted with their own letter to the government, refuting various myths regarding the dangers of Bitcoin mining. Attempts to control the mining sector or amend Bitcoin’s code to eliminate mining from its operations have often been met with strong opposition.
Critics of Biden’s proposed excise tax believe the fee arbitrarily targets specific forms of energy consumption.