As tax season is rapidly approaching, some states, like Ohio, have decided to set a new standard for the rest of the country to follow. Back in November, Ohio became the first state in the U.S. to announce that it would now be possible to pay taxes using bitcoin.
While Ohio is first in actually implementing this for its business residents, it’s certainly not the first one to try. Other U.S. states, like Illinois, Arizona, and Georgia have previously attempted to pass legislation allowing state taxes to be paid with cryptocurrency; however, such attempts have been rejected by state lawmakers or have not yet taken final form.
State of Ohio Treasurer, Josh Mandel, told Bitcoin Magazine that he’s been a crypto-enthusiast since 2014. Implementing his vision today, Ohio business owners are now able to register and resolve their tax disputes and/or liabilities online, with their payments processed by a designated cryptocurrency payment service provider.
Bitcoin Magazine spoke with Mandel about why Ohio’s decision to embrace these new technologies is a step toward the state becoming a leader for the rest of the country.
Why Is This Good for Ohio?
With this announcement, Ohio has announced to the rest of the country that it is at the forefront of new technologies, specifically as it pertains to blockchain technology and cryptocurrency. By opening up its doors to entrepreneurs and businesses dabbling in these digital realms, Ohio hopes to welcome new types of ventures across its state lines.
“Our biggest motive here was to give taxpayers more options in paying their taxes,” Mandel explained. “Secondly, we wanted to project to the rest of the country that Ohio is embracing technology and is a place that is welcoming software developers and entrepreneurs who want to build a blockchain business here in the State of Ohio. By launching Ohiocrypto.com, we are planting the flag here in the state, and showing that we are a leader.”
Mandel said that he and his office have been working on launching Ohiocrypto.com for a good portion of this year, emphasizing that this new system will yield many positive reverberations for years to come.
You Don’t Have to Be a Computer Whiz or Crypto Expert to Participate
The good news is, you don’t have to be a computer expert or a crypto expert in order to use Ohiocrypto.com.
One benefit, according to Mandel, “will obviously be providing business taxpayers with another option in which to settle their taxes, which is easy and intuitive for them to use.”
However, it’s important to note that this is only available to Ohio business owners — not individuals — to settle their private taxes.
Phase One
Phase I of Ohiocrypto.com, according to Mandel, allows Ohio businesses to pay 23 different business taxes in cryptocurrency, specifically with bitcoin. Here is a sample of the most commonly paid business taxes, which are part of the Ohiocrypto.com system:
- Cigarette/Other Tobacco Products
- Commercial Activity Tax (CAT)
- Petroleum Activity (PAT)
- Public Utilities Tax (PUT)
- Sales Tax (ST)
- Withholding Tax (WHT)
- Interest on Lawyer’s Trust Accounts (IOLTA)
- Motor Vehicle Fuel (MVFT)
Phase Two
“In Phase II, we hope to expand Ohiocrypto.com to include individual personal taxes, and also to expand beyond just bitcoin and include other cryptocurrencies as well. We thought the most intuitive and responsible way to begin this initiative, because it’s the first time it’s ever been done in America, is to start it off right — and that is by only allowing businesses to pay with bitcoin, and expand it out from there.”
A New, Inexpensive Way to Pay Your Taxes
Not that any of us enjoy coughing up the green each year, but Mandel emphasized that one of the major benefits to the Ohio taxpayer is that, by using Ohiocrypto.com, the state is providing a cost-cutting mechanism when taxpayers go online.
“Prior to the launching of Ohiocrypto.com, the state allowed for taxpayers to pay their taxes in different ways — you could pay via check with no processing fee; you could pay via ACH with no processing fee; or you could pay via credit card with a 2.5 percent processing fee. But, the fee to pay via cryptocurrency, e.g. bitcoin, is only going to be 1 percent, which is less than paying via credit card.”
OhioCrypto.com
Mandel emphasized that Ohiocrypto.com is an initiative open to taxpayers of all different ages, stripes and geographic parts of the state. Once the taxpayer is successfully registered on the site and has entered their tax payment information, the amount of cryptocurrency in the compatible wallet that is used to pay the invoice is immediately converted from bitcoin to U.S. dollars and processed through BitPay.
“Most likely, I think we will see heavier use by smaller/medium size companies, privately owned, and probably some taxpayers in the younger demographic,” the Ohio Treasurer added.
“But, ultimately, as awareness builds, we will see widespread use — from a mom-and-pop diner to Fortune 500 companies. We are excited about the launch of this and we have a great partner in this initiative with BitPay.”
Mandel told us that BitPay has been very responsive to its office, bending over backwards in order to ensure that the site is developed in a way that is extra safe and extra secure so that taxpayer money is protected at all costs.
“We are thrilled to see Josh and State of Ohio taking this initiative,” Stephen Pair, co-founder and CEO of BitPay, told Bitcoin Magazine.
“One of the things we’ve done at BitPay over the years is to talk to companies in the blockchain industry help them work with their vendors to sign up and pay their bills with crypto. For example, an exchange has to pay vendors and suppliers. They would obviously prefer to pay their bills via crypto, which helps to grow the ecosystem and benefits their own exchange business. Similarly, all these businesses have to pay taxes as well and we are thrilled to help Ohio businesses pay their taxes this way.”
It should be noted that at no point will the Ohio Treasurer’s office hold cryptocurrency, mine it, or invest in it.
Ohio Is Looking to Host a Blockchain and Cryptocurrency-Friendly Environment
The state also hopes to benefit by branding itself as a place that is blockchain friendly, cryptocurrency friendly, and open for business when it comes to technology.
According to Mandel, this first step has put Ohio on the map in becoming a leader in the blockchain technology and cryptocurrency space.
Mandel, in addition to selected representatives from the treasurer’s office, recently attended the four-day Blockland Conference in Cleveland, where software developers, entrepreneurs and business leaders came together to learn how to inspire entrepreneurs and showcase the region as a potential hub for new technologies and a national leader in blockchain technology.
The lineup of speakers featured Beth Mooney, CEO at Cleveland-based KeyCorp; AT&T Communications CEO, John Donovan; Jerry Cuomo, an IBM vice president focused on the blockchain; Oracle Corp. CEO, Mark Hurd; and Wikipedia co-founder, Larry Sanger.
What Challenges Lie Ahead?
It would seem that in a year filled with data breaches and security incidents with major players like Facebook, Equifax and other institutions, that this would seem all the riskier.
Bitcoin Magazine also spoke with Ari Lewis, cryptocurrency advisor to the State of Ohio Treasurer’s office, on this matter.
“We spent a lot of time and effort in extensively vetting payment processors,” Lewis emphasized. “We were extremely confident in choosing BitPay because they were first in class in security and in guaranteeing taxpayer monies would be safe. So, for us, this was not a trial and error, and we see this as a program where we feel confident that taxpayer money is secure and all the transactions occurring are secured through the payment system.”
Photo Credit: Josh Mandell / State of Ohio Treasurer’s Office
This article originally appeared on Bitcoin Magazine.
via Bitcoin Magazine https://bitcoinmagazine.com/articles/why-ohios-state-treasurer-backs-decision-accept-btc-tax-payments/#1546451615
No comments:
Post a Comment