If Bitcoin payments are subjected to additional tax deductions, then there is no use in allowing them to replace the fiat monetary payments. In this case, the salary payments can be made in hard cash, which can be later converted to Bitcoin by the employer (if that is needed). I am still getting a little bit confused about the taxes.... are they talking about the capital gains tax?
Yes. They are saying that at the end of each year, all of the purchases that you made with bitcoin and all the coins you converted to fiat will be taxed for any capital gains they made that year.
You get paid $100k in bitcoin.
End of the year comes and it is worth $150k.
You buy a house.
You pay the capital gains taxes on your bitcoin profits of $50k.
In the opposite scenario, your bitcoins lose 50% of their value and you get a tax deduction. As long as you don't buy, trade, or convert to fiat, then Uncle Sam cannot reach into your bitcoin wallet. Of course, you can't pay taxes using bitcoin yet...