Biden proposed 30% mining tax. what would impact on Bitcoin mining?

[philipma1957]

Standard govt double dipping scam.

You pay tax on your bitcoin income but they wanna tax you twice on how you spend that already taxed bitcoin income.

it's not a double tax on bitcoin income. they would be taxing the electricity expense. not the income from mining. two different things.

A typical company earns BTC to pay for the power. It's a a standard govt double tax.
In this case it simply increases your electricity cost by 30%, so decreases your profit, and increases tax revenue from you.
Simple math.

Nothing new, hopefully it fails.

so you're against paying excise tax for gasoline?

Read the topic:

Biden proposed 30% mining tax

Your philosophical opinions of types of taxes are not the topic.

It's a simple - more tax, less revenue directed at mining.

Exactly it will slow growth in USA 🇺🇸 because  it will cost more to mine it phases in

10% 20% 30%

does not start till 2024 or never 👎

[1714637649]

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[larry_vw_1955]

The 30% is actually Biden's proposal, so it's a bit of a long question if it can be approved, I'm also sure that most of them will not agree with what Biden wants to happen.

That's a huge amount in fact, it seems like Biden wants to legally rob the people, the proposals he's making that are 30% are out of the question. Woe to those who will be hit when that becomes their law.

when you say "Biden" you mean the democratic party, right? surely Biden didn't come up with this idea all on his own.  

A typical company earns BTC to pay for the power.

you've got it backwards though. the idea is to pay for the power first. then generate the profits. just like a trucker has to pay up front for thieir gas before they can make that trip... gas has a built in excise tax.

It's a a standard govt double tax.

so i guess ups drivers or door dash delivery drivers should be really angry how they're being double taxed due to having to pay taxes on their net income but also the excise tax on gasoline they purchase so they can operate their equipment. but you don't see them complaining about it.

In this case it simply increases your electricity cost by 30%, so decreases your profit, and increases tax revenue from you.
Simple math.

that's the idea behind an excise tax is to punish or penalize people for doing some behavior that contributes to negative environmental outcomes. i disagree with an excise tax on solar power used for bitcoin mining since i don't see how that harms the environment but things like coal power plants or nuclear power or even hydro-electric even large wind turbines they all have environmental consequences thus an excise tax might be appropriate.

we all can agree that driving cars and using gasoline does have a negative impact upon the environment so the less of it we do the less we should be punished. the more of it we do the more we should be paying for that privilege. thus the excise tax. same with smoking. same with alot of things like that.

[touseefahmad1999]

It's unlikely that the additional electricity tax will attract new miners to Bitcoin mining, as it would increase the overall cost of mining and reduce profitability, making it less attractive for new miners to enter the market.

Regarding the impact on hashpower for a 30% mining tax, it is difficult to estimate with certainty, as it would depend on various factors such as the current price of Bitcoin, the efficiency of mining equipment, and the availability of cheap electricity sources. However, in general, a 30% mining tax would increase the cost of mining, leading to a reduction in the number of miners and, in turn, a reduction in the overall hashpower of the Bitcoin network

[royalfestus]

Texas' anti-Bitcoin mining bill passed through Senate committee uncontested without a single opposition vote today. It is on the "uncontested" list, which means it has a 95%+ chance of passing the Senate. There is a possibility that Texas will become a global hub for mining.

[NotFuzzyWarm]

Texas' anti-Bitcoin mining bill passed through Senate committee uncontested without a single opposition vote today. It is on the "uncontested" list, which means it has a 95%+ chance of passing the Senate. There is a possibility that Texas will become a global hub for mining.

Links please or it's just random Internet rambling...

[larry_vw_1955]

Links please or it's just random Internet rambling...

people can't google...

https://au.finance.yahoo.com/news/texas-bill-limiting-benefits-crypto-192739843.html

[FP91G]

In Sweden, taxes will increase more. $0.0006 was a miner's paradise

Energy prices started to normalize in 2023, but the upcoming tax will likely stop any new investment in Sweden, which is currently home to about 150 megawatts (MW) of mining. The tax will increase from SEK 0.006 ($0.0006) to SEK 0.36 ($0.035) per kilowatt hour (kWh) starting July of this year, according to the financial budget published in November 2022.

Based on the average electricity prices last year, the tax hike could bring the all-in energy cost to $0.093/kWh, said Jaran Mellerud, senior analyst at mining services firm Luxor Technologies. A MicroBT Whatsminer M30s, a moderately efficient and commonly used machine, would be at break-even point given current market conditions, he said.
https://getblock.net/en/news/sweden-will-raise-the-electricity-tariff-for-miners-58-times/

[mikeywith]

In Sweden, taxes will increase more. $0.0006 was a miner's paradise

Energy prices started to normalize in 2023, but the upcoming tax will likely stop any new investment in Sweden, which is currently home to about 150 megawatts (MW) of mining. The tax will increase from SEK 0.006 ($0.0006) to SEK 0.36 ($0.035) per kilowatt hour (kWh) starting July of this year, according to the financial budget published in November 2022.

Based on the average electricity prices last year, the tax hike could bring the all-in energy cost to $0.093/kWh, said Jaran Mellerud, senior analyst at mining services firm Luxor Technologies. A MicroBT Whatsminer M30s, a moderately efficient and commonly used machine, would be at break-even point given current market conditions, he said.
https://getblock.net/en/news/sweden-will-raise-the-electricity-tariff-for-miners-58-times/

Is it 3.5 cents per kilowatt hour or is it 9.3 cents? I am not sure what all-in energy cost means, if the tax is going to increase the cost from 0.6 cents to 3.5 cents where does the remaining 5.8 cents come from?

Anyway, 3.5 cents is way below average = great for mining, 9.3 cents is above average and terrible for mining.

[royalfestus]

What are the prospects of solar power replacing government power sources for mining if regulations are supportive? When will the issue of power usage in mining end in the USA and other regions? Mining has become a privilege of the wealthy due to the costs involved, including equipment expenses. However, with the potential profitability of mining, the affordability of necessary equipment may not remain a barrier for long

[larry_vw_1955]

A typical company earns BTC to pay for the power.

as long as they have a predictable income that they know 100% sure they can pay for the power by using unrealized income then ok. but you don't go into a convenience store and eat a candy bar and then try and pay for it but then complain about the tax saying you can't afford it...

In this case it simply increases your electricity cost by 30%, so decreases your profit, and increases tax revenue from you.

what's wrong with that?

Read the topic:

yeah to kickstart a discussion. guess who created this thread. oops maybe it wasn't me this time.  

Your philosophical opinions of types of taxes are not the topic.

It's a simple - more tax, less revenue directed at mining.

it's not a tax it would be an excise tax. get your facts straight...

buying a candy bar doesn't harm the environment and contribute to higher electricity prices for everyone and also contribute to global warming. you still pay sales tax on the candy bar but an excise tax ON TOP OF THAT would be unnecessary.

excise taxes really aren't taxes at all, they are penalties for doing something bad that contributes to negative outcomes in the real world. therefore if someone insists on doing that activity they should be responsible enough to pay up for the damages they are causing don't you think?

[philipma1957]

A typical company earns BTC to pay for the power.

as long as they have a predictable income that they know 100% sure they can pay for the power by using unrealized income then ok. but you don't go into a convenience store and eat a candy bar and then try and pay for it but then complain about the tax saying you can't afford it...

In this case it simply increases your electricity cost by 30%, so decreases your profit, and increases tax revenue from you.

what's wrong with that?

Read the topic:

yeah to kickstart a discussion. guess who created this thread. oops maybe it wasn't me this time.  

Your philosophical opinions of types of taxes are not the topic.

It's a simple - more tax, less revenue directed at mining.

it's not a tax it would be an excise tax. get your facts straight...

buying a candy bar doesn't harm the environment and contribute to higher electricity prices for everyone and also contribute to global warming. you still pay sales tax on the candy bar but an excise tax ON TOP OF THAT would be unnecessary.

excise taxes really aren't taxes at all, they are penalties for doing something bad that contributes to negative outcomes in the real world. therefore if someone insists on doing that activity they should be responsible enough to pay up for the damages they are causing don't you think?

Using btc mining profits to build solar arrays does not hurt the environment.

we have built three arrays with btc profits.

45k
115k
275k

comes to over 2 mega watts a day.

I should not be treated like a piece of shit coal based miner polluting like mad to burn coal.

I should pay -10% on my power bill and coal based miners should pay 30% on their bill.

[FP91G]

In Sweden, taxes will increase more. $0.0006 was a miner's paradise

Energy prices started to normalize in 2023, but the upcoming tax will likely stop any new investment in Sweden, which is currently home to about 150 megawatts (MW) of mining. The tax will increase from SEK 0.006 ($0.0006) to SEK 0.36 ($0.035) per kilowatt hour (kWh) starting July of this year, according to the financial budget published in November 2022.

Based on the average electricity prices last year, the tax hike could bring the all-in energy cost to $0.093/kWh, said Jaran Mellerud, senior analyst at mining services firm Luxor Technologies. A MicroBT Whatsminer M30s, a moderately efficient and commonly used machine, would be at break-even point given current market conditions, he said.
https://getblock.net/en/news/sweden-will-raise-the-electricity-tariff-for-miners-58-times/

Is it 3.5 cents per kilowatt hour or is it 9.3 cents? I am not sure what all-in energy cost means, if the tax is going to increase the cost from 0.6 cents to 3.5 cents where does the remaining 5.8 cents come from?

Anyway, 3.5 cents is way below average = great for mining, 9.3 cents is above average and terrible for mining.

If miners in Sweden pay tax as in Kazakhstan, then 0.035 US dollars is a tax or excise, which means the cost of electricity is 0.093-0.035=0.058. This is a mining tax, and you also need to pay income tax. The big mining companies don't say how they buy electricity, but almost 10 cents is expensive to mine.

[larry_vw_1955]

Using btc mining profits to build solar arrays does not hurt the environment.

we have built three arrays with btc profits.

45k
115k
275k

comes to over 2 mega watts a day.

I should not be treated like a piece of shit coal based miner polluting like mad to burn coal.

I should pay -10% on my power bill and coal based miners should pay 30% on their bill.

yeah that's the part of the proposed legislation that makes no sense. they throw in the good guys along with the bad ones....i understand an excise tax on someone that's using electricity from the power grid to run their operation but not for someone that generates their own electricity using solar panels. that doesn't make any sense at all.  

people that are conscientious and trying to use solar for mining shouldn't be punished. if that crap passes, solar miners need to band together and make some formal complaints because that sh** aint right...

[leepx]

Why not help miners within your country? I have always been curious why countries make learning and gathering information on subjects so hard that competitive countries get a head start.

[larry_vw_1955]

Why not help miners within your country? I have always been curious why countries make learning and gathering information on subjects so hard that competitive countries get a head start.

miners don't mean anything to the usa government. but it does make laws that it thinks help the environment like phasing out gas powered lawncare equipment and things like that.

[Flexystar]

It doesn't matter. It will anyway get compensated against the company book. For example there are electricity bills, cost of construction, mining maintenance which means employees around the mining farm and their salaries. I think it would be benefit the user in terms of their credit history building as they would be paying high taxes. Moreover this will be only levied once miner sell their crypto currencies. Whenever they will sell the crypto they will profit, they will have expenses to calculate, everything will substract at the end. The nett proceeds is what they will get charged for. The tax slot is huge but it does not mean that it is gonna impact the crypto economy badly. Take an example of Indian tax system. There were the first to levy tax slot of 30%. What is surprising is, this is not only for miners, this is basically for everything you do in association with the crypto. They still use crypto and nothing happened in terms of crypto economy.

[larry_vw_1955]

Take an example of Indian tax system. There were the first to levy tax slot of 30%. What is surprising is, this is not only for miners, this is basically for everything you do in association with the crypto. They still use crypto and nothing happened in terms of crypto economy.

why would someone use bitcoin if they had to pay 30% tax on every purchase? that sounds like someone with a solution looking for a problem...

[Abiky]

why would someone use bitcoin if they had to pay 30% tax on every purchase? that sounds like someone with a solution looking for a problem...

That my friend would be "overtaxation". It's something done by the government to intentionally drive away people from crypto/Blockchain tech. India tried to do it, but it failed. For now, the US will require miners to pay a 30% tax on their income. I don't think this will be approved by Congress, especially when there are many pro-crypto politicians in the country. Americans had enough with the SEC drama against exchanges. Adding more burden to the industry will simply drive innovators and companies away from the US.

One thing for sure is that PoW mining is a hotly-debated subject due to its "high energy consumption". Considering that most countries are turning "green", it's likely PoW mining will be banned in the future. Maybe BTC will change its algo to something better than PoS without compromising decentralization? Just my thoughts

[Porfirii]

I'm not sure whether this policy would kill Bitcoin mining in the USA, but the impact for many legit miners would make them close up their business.

I have witnessed it myself with all miners in Spain (big and small): back in 2017 the tax agency forced all miners to create a company or register as freelancers, which meant that they suddenly had to pay >300€/month regardless of their production just in order to be able to switch on their computer, plus between 25%-50% of their income in taxes every year. If we add the increase in the price of electricity to the equation, they simply killed Bitcoin mining in my country.

[HedgeFx]

It is easy to expect that miners (at least the sizable ones) will leave the US in search of new countries with more favorable taxation. Obviously this could involve moving all the equipment to these countries

President Joe Biden's administration has imposed a 30% tax on bitcoin mining electricity use. Bitcoin mining was not very profitable even though this tax was not levied in the past. But what impact will the new electricity cost have on Bitcoin mining?

Will this additional electricity tax attract new miners to Bitcoin mining?

What will be the impact on hashpower for a 30% mining tax?

Even before the imposition of this tax, some mining companies were in losses.
What are the old mining companies thinking about this tax?