GOP Congressman Introduces First Bill to Tax Bitcoin
Congressman Steve Stockman (R-Texas) is no stranger to controversy. He gives away assault rifles via Twitter, mocks global warming as a “fad thing” and dismisses the Violence Against Women Act as “horrible” because it protects transgender “men dressed up as women.”
And now the controversial, ultra conservative politician is back in the news in a big way once again, this time for something far tamer, yet quite momentous -- he’s introducing a bill that would officially categorize Bitcoin (and other virtual currencies) as currency, not as property, as the IRS did last month in its landmark March 25 ruling.
Stockman announced his bill, titled the “Virtual Currency Tax Reform Act,” during his speech at Mediabistro’s Inside Bitcoins conference in New York City yesterday.
The bill, which is only a single-page, five-sentence draft, very loosely defines what virtual currency is and, more importantly, seeks to have the IRS “treat virtual currencies as currency for federal tax purposes.”
Stockman, who notably isn’t being cast off in the Bitcoin community as an opportunistic Johnny-Come-Lately, was the first U.S. senator to solicit Bitcoin election donations.
He said doesn’t necessarily expect the bill to become a law, but hopes it sparks a conversation about Bitcoin on Capitol Hill. The pro-gun, pro-life free market libertarian said his goal in creating it is to “build awareness” about cryptocurrencies amongst legislators, many of whom are still struggling to figure out exactly what Bitcoin is, whether they're for or against it, and, of course, whether or not it should be regulated.
“This is a nascent industry,” Stockman commented on his proposed legislation in an announcement released on his website yesterday. “Along with 3-D printers and nanotubes, cryptocurrency is the future. We need to encourage it, not discourage it. There is risk associated with every budding industry in America."
Stockman’s no stranger to controversy. NPR recently pointed out that the Texas 36th District congressman -- who was charged in 1977 with felony drug possession for stashing Valium in his underpants (charges were later dropped) and whose 2013 campaign bumper sticker reads “If babies had guns they wouldn’t be aborted.” -- isn’t the most becoming poster boy for Bitcoin.
Stockman “has already had some run-ins with the Federal Election Commission over campaign finance issues,” NPR’s Emily Siner reported, “so he may not be the ideal political spokesman for a currency that has no centralized network or official physical form.”
One of Stockman’s sketchy campaign finance “run-ins” involved “improper” contributions from his former campaign treasurer and another staffer during his 2013 campaign.
Even Texas tea partiers have formally “disavowed” the Michigan native and former homeless college dropout. Dismissing him as “unethical,” they criticized Stockman for failing to show up for 17 consecutive House votes earlier this year, one time because he was reportedly the guest of honor at New Year’s Eve launch of Bitcoin Center NYC, a pro-cryptocurrency organization headquartered in Manhattan’s Financial District, just paces from the New York Stock Exchange.
Stockman was back at Bitcoin Center NYC again last night for an Inside Bitcoin after-party, buzzworthy bill triumphantly in hand.
Here’s a video showing the congressman discussing the benefits of Bitcoin with Bitcoin Center NYC co-founder Nick Spanos:
Meanwhile yesterday, members of Congress got a glimpse of Capitol Hill’s first Bitcoin ATM machine. And, while the news was still buzzing this morning about Stockman’s historic so-called “Bitcoin bill,” (oddly without much mention of his questionable ethics and past, we noticed), U.S. Attorney General Eric Holder testified before the House Judiciary Committee that the U.S. Department of Justice is working with financial regulators to keep a close watch on Bitcoin transactions for criminal activity.
The Bitcoin story just gets juicier by the minute, doesn’t it?
Kim Lachance Shandrow is the former West Coast editor at Entrepreneur.com. Previously, she was a commerce columnist at Los Angeles CityBeat, a news producer at MSNBC and KNBC in Los Angeles and a frequent contributor to the Los Angeles Times. She has also written for Government Technology magazine, LA Yoga magazine, the Lowell Sun newspaper, HealthCentral.com, PsychCentral.com and the former U.S. Surgeon General, Dr. C. Everett Coop. Follow her on Twitter at @Lashandrow. You can also follow her on Facebook here.