Crypto mining stocks rallied on Tuesday as President Joe Biden apparently agreed to withdraw his planned 30% tax on electricity used by the companies.
“The current debt proposal does not include a digital asset mining energy tax,” Rep. Warren Davidson (R-Ohio) told Forbes in a written statement. “We’ve spoken out to oppose this tax and I see this as a significant victory.”
Riot Platforms led gainers among the major mining stocks, rising 10%. Iris Energy, Hive Blockchain, Cleanspark, Hut 8 MIning and Marathon Digital Holdings were up 5.5% or more.
Biden and House Speaker Kevin McCarthy (R-Calif.) reached a tentative deal to suspend the U.S. debt ceiling over the weekend, and Davidson confirmed that the agreement excludes administration’s plans to levy the tax. The arrangement is subject to congressional approval.
The White House did not respond to Forbes’ request for comment.
The proposal titled the Digital Assets Mining Energy excise act, or the DAME act, was introduced by the White House as part of President Biden’s proposed budget for the 2024 fiscal year in early May.
Under its terms, any firm using computing resources—whether owned or leased—to mine digital assets would be subject to an excise tax on the related electricity costs. The tax would be phased in starting at 10% in 2024, rising to 20% in 2025 and 30% in future years.
“The primary goal of the DAME tax is to start having crypto miners pay their fair share of the costs imposed on local communities and the environment,” the White House said in a May 2 statement shared on its website. The tax was estimated to raise $3.5 billion in revenue over 10 years.
Even though the tax appears stalled for now, it doesn’t mean it couldn’t be floated again at some later date.
