Senators Urge Treasury to Amend Digital Asset Tax Provision

According to Cointelegraph, two U.S. senators have urged Treasury Secretary Scott Bessent to utilize his authority to amend a tax provision impacting corporate holdings of digital assets. In a letter dated May 12, Senators Cynthia Lummis and Bernie Moreno proposed that Bessent could redefine 'adjusted financial statement income' under current U.S. law to potentially lower the tax burden on digital asset companies. This adjustment aims to alter a provision of the Inflation Reduction Act, enacted in 2022. Senator Lummis expressed concern over the competitive edge of U.S. digital finance, stating in a May 13 post on X that domestic companies could face higher taxes compared to their foreign counterparts. The senators believe the proposed change would offer relief to corporations investing in digital assets. Lummis has been a vocal advocate for digital assets in Congress, while Moreno, who assumed office in January, received significant support from crypto-backed political action committees during his 2024 Senate campaign. The Inflation Reduction Act, effective since 2023, mandates a 15% minimum tax on companies reporting over $1 billion in profits for three consecutive years. This includes unrealized crypto gains and losses, prompting Lummis and Moreno to urge the Treasury Department to act promptly. The senators' appeal coincides with the Senate's anticipated consideration of another vote on the Guiding and Establishing National Innovation for US Stablecoins, or GENIUS Act. This legislation seeks to regulate payment stablecoins in the U.S. However, a motion for consideration was stalled in the Senate on May 8, partly due to Democratic opposition linked to U.S. President Donald Trump's connections to the crypto industry. Lummis, a co-sponsor of the bill, remains committed to supporting digital asset regulation, with the Senate potentially revisiting the vote soon.