The state of Arizona could be on track to becoming a tax-free crypto oasis with its latest move to stop local authorities from imposing taxes on blockchain node operators. Governor Katie Hobbs vetoed the legislation, Senate Bill 1236, on April 12th, her 100th day in office, following approval in both the Arizona Senate and House.
Pro-Crypto Legislation: Tax Exemptions & Legal Tender
The legislation, first proposed in January, aimed to revise sections of statutes pertaining to blockchain technology and largely reducing or eliminating taxation of node operators as well as prohibiting any local city or town from imposing a tax or fee on any person or entity for running a blockchain node in their residence. If the bill had passed, counties too would have been prohibited from taxing individuals running node operators.
The veto follows other legislative proposals aimed at making the U.S. state a pro-crypto environment. State Senator Wendy Rogers led a resolution to make cryptocurrency exempt from property taxation under the state’s constitution. While other senators proposed voting on whether to make Bitcoin (BTC) legal tender.
Arizona’s 2018 Veto and Beyond
This is not the first time Arizona has attempted to pass pro-crypto legislation. Back in 2018, Governor Doug Ducey vetoed a bill that would have allowed citizens to pay their taxes using cryptocurrency. That proposed legislation would have faced a different political climate to today. However, with the majority of statePolitics leaning Republican, compared to the current Democrat majority.
On a more general level, Cryptocurrency taxes are an interesting topic worldwide. Colorado Governor Jared Polis even allowed their residents to pay taxes in crypto. While Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming offer 0% capital tax gains to potential investors.
Arizona’s Crypto-Friendly Oasis is A Lone Voice?
The American State of Arkansas recently passed a bill through their House of Representatives and Senate to regulate Bitcoin mining and protect miners from discriminatory regulations and taxes. On the other hand, the State of New York has banned crypto mining activities for two years and on a federal level. Miners in the United States could eventually be subject to a 30% tax on electricity costs.
Citizens living in Arizona could be set for a treat should the proposed bill pass, creating a crypto-friendly, tax-free oasis. Time will tell whether the proposed legislation is the beginning of the trend or a lone voice in the desert.
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