As controversy surrounding how the authorities handle cryptocurrency management grow, in the state of Ohio there is a website being set up to allow the businesses to pay their taxes with the use of bitcoin. The Wall Street Journal published an article showcasing how Ohio offered a tacit acceptance through allowing businesses to use cryptocurrency when paying taxes.
One thing that many do not know is that this is not the first attempt that was made by a US state to allow the use of cryptocurrency in taxation. However, it is the most successful one till now.
In February we saw the Arizona State Senate passing a bill to allow state residents to pay their income taxes with different cryptocurrencies. This did not go through. As the bill became law, cryptocurrency references were already out of the file.
In the same month we saw Vermont trying to allow the use of cryptocurrency in taxation. Complications appeared because of state laws so the bill was quietly removed from attention.
The reason why Ohio might be successful this time is the fact that strategy was different. In Ohio there is a quiet attempt to introduce tax initiatives that are bitcoin-friendly as opposed to making the effort highly-publicized. The attempt is to push everything through an amendment without having political drive. Basically, politicians are not involved.
Josh Mandel, State Treasurer, is the biggest part of the move. He is capable of accepting bitcoin without having approval from the governor or the legislature. This is actually a part of the personal prerogative.
What is particularly interesting is that Ohio is going to be an interesting test run. It will show if the US government is able to collect taxes coming in as bitcoin. According to Mandel, the idea is to have the state plant a flag in wider adoption of cryptocurrency.
In the event that this project is a success, even if the initial run will be low and not much bitcoin is going to be used to pay business taxes, it will prove that the use of cryptocurrency can be useful for businesses. It will also show a precedent that can be used in order to pass highly similar tax legislations in the US.