Kentucky legislators have approved a bill that would offer tax incentives to bitcoin miners that set up shop in the state.
An overwhelming majority of lawmakers in Kentucky has just approved a bill that seeks to make the state a very attractive option for bitcoin mining operations.
The primary bill to receive approval, House Bill 230, seeks to remove some tax obligations from bitcoin miners and is geared toward incentivizing job creation and spurring the growth of the industry. It was passed by a 19-to-two vote by a committee in the Kentucky house.
“The bill’s fiscal note estimated its cost to the General Fund to start at $1 million a year,” the Lexington Herald-Leader reported. “But the full cost after that cannot be determined, legislative staff wrote, because ‘it is unknown how many of the businesses might choose to locate here to avail themselves of this exemption.’”
The bill will now move to the state’s upper chamber for review. The bill’s sponsors noted in their submission that Kentucky could leverage its low energy rates, plus the abundance of the supply of such energies, to cement its position as a national leader in cryptocurrency mining in the United States.
The ratification of this bill would mean that commercial bitcoin miners in Kentucky would enjoy exemptions from paying a 6 percent sales tax and 6 percent excise tax on tangible personal property (such as mining rigs) that is directly used in the process as well as the electricity used. Though some lawmakers expressed their reservations about the amount of electricity needed to power these mining activities, the ability to lure more industrial operations, plus the recent growth cryptocurrencies like bitcoin recently, should make this bill a very attractive option.