The authorities of the state of Colorado bas announced that residents in the state can now pay their taxes in cryptocurrencies instead of fiat. Among the supported cryptocurrency payment mediums are are Bitcoin (BTC) and Ether (ETH). However, Colorado’s Revenue Department is still not allowed to accept direct cryptocurrency payments which is why it partnered with PayPal to help in processing the transactions.
The State’s officials revealed that Colorado residents can now use cryptocurrencies to pay their business income tax, individual income tax, sales and use tax, severance tax, withholding tax, and excise fuel tax. Individuals can also pay in Bitcoin Cash and Litecoin asides Bitcoin and Ether. The Revenue Department can not accept direct digital asset payments, so partnered with PayPal, which will broker each transaction and convert cryptocurrencies into US dollars. This means consumers will pay certain fees for that service.
The move means Colorado is the first American state where individuals can use digital assets for tax payments. Utah is the only other state where such options are being planned, and it is expected to be actualized by the beginning of 2023. Back in 2018, Ohio also announced similar plans. However, the authorities withdrew their plans after Attorney General Dave Yost argued that it would not benefit the local financial system.
Colorado is not the only state where the cryptocurrency industry thrives. In Florida, Miami’s Mayor Francis Suarez tried to attract bitcoin miners by making provisions for cheap nuclear electricity. Suarez who is a keen proponent of the primary digital asset also argued that Miami should turn into a cryptocurrency hub, while BTC must be integrated into every nook and cranny of society.
New York City’s Mayor – Eric Adams – is also a proponent of the digital asset industry. He vowed to receive his first three paychecks in bitcoin and he later opined that blockchain technology and its merits should be taught in schools. Lastly, Senator Wendy Rogers of Arizona introduced a bill that could turn bitcoin into a legal tender in the region at the beginning of 2022. If the bill is approved, the Grand Canyon state will become the first state where BTC is an official payment medium.
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