The Biden administration is proposing a 30% tax on electricity energy which is used for cryptocurrency mining activities.
In one post on the White House website, the Biden administration officially introduced the concept of the Digital Asset Mining Energy Excise Tax, or DAME.
He explained that he wants to tax cryptomining companies because they don't pay for the "costs they impose on others," which include environmental pollution and high energy prices.
Crypto mining has "negative effects on the environment," the White House continued, and the pollution it creates "falls disproportionately on low-income neighborhoods and communities of color." He added that businesses' "often erratic energy consumption" can raise electricity prices for people around them and cause service disruptions.
In addition, local power companies take on a business risk if they decide to upgrade their equipment to make their service more stable, as miners can easily be moved to another location, even overseas.
On this the Yahoo News notes that there are other industries, such as steel, that also use large amounts of electricity, but are not taxed for their energy consumption.
To counter the White House stating that cryptomining “does not generate local and national economic benefits which are usually associated with businesses that use similar amounts of electricity'.
Critics believe the government made this proposal to hurt an industry it does not support. This could encourage mining companies not only to minimize energy use, but also to find cleaner energy sources.
