Rep. Patrick McHenry, a Republican of North Carolina and ranking member of the House Financial Services Committee, speaks during a hearing in Washington, D.C.
Andrew Harrer | Bloomberg | Getty Images
A bipartisan group of House representatives introduced a bill Thursday to address a contentious new tax reporting requirement for cryptocurrency in the infrastructure bill.
The Keep Innovation in America Act, led by Reps. Patrick McHenry, R-N.C., and Tim Ryan, D-Ohio, would define brokers, newly bound to the tax reporting rules, so that software developers without the necessary customer information to report are not tied up in the new provision.
Though lawmakers attempted to include a fix to the perceived issue prior to the infrastructure bill’s passage, an amendment was blocked by Sen. Richard Shelby, R-Ala., for what he said was an unrelated reason.
Trade groups representing the cryptocurrency industry warned of the uncertainty the new tax reporting requirement would create without more specific language. Some crypto advocates warned it would push the industry to other countries to avoid the complicated rules in fear that they unwittingly fail to comply.
The same groups cheered the new bipartisan bill in statements on Thursday accompanying the bill’s release.
“We applaud Congressman McHenry’s bipartisan efforts to clarify the overly-broad and unclear language targeting crypto in the infrastructure bill,” Blockchain Association CEO Kristin Smith said in a statement.
“This legislation will protect innovation in the United States and strengthen our status as a leader in blockchain technology,” Perianne Boring, founder and CEO of the Chamber of Digital Commerce, said. She added that it takes a necessary step “to protect consumer privacy by undoing a potentially intrusive part of the infrastructure bill that threatens treat crypto users like criminals and force crypto to share private information to engage in routine transactions.”
Though the language was not altered prior to the infrastructure bill’s passage, industry groups said the debate drew new attention to cryptocurrency in Congress, especially as lawmakers saw a flood of calls from their constituents asking to reform the language.