Joe Biden addressed Congress and urged lawmakers to take away the ability of wealthy crypto investors to avoid paying taxes.
Eliminating this loophole would allow the U.S. to raise about $18 billion for the budget, the president believes. It is not yet reported what specific legislative initiatives will be involved.
The president’s message to Congress included a reference to the Internal Revenue Service (IRS) rule on sham asset sales.
Tax rule prohibits selling the same securities at a loss and buying them back within 30 calendar days.
For traditional investors, this is a common strategy called tax-loss harvesting, where the fictitious sale and buy-back method reduces the tax base of capital gains.
A crypto-enthusiast under the pseudonym FatMan tweeted that Biden was “looking for income in the wrong place.”
The analyst recalled that the crypto-asset market capitalization fell to $1.4 trillion in 2022, while corporate profits in the U.S. were about $12 trillion.
Earlier, the U.S. President’s Council of Economic Advisers (CEA) proposed a thirty percent tax on miners to offset the negative impact of cryptocurrency mining on the climate.