Kentucky Governor Signs Two Bills to Provide Tax Breaks to Crypto Mining into Law
Two bills relating to the taxation of the commercial mining of cryptocurrency have been signed into law this week by the Kentucky governor.
As per the bill, a new section of KRS 139 has been created, which defines various terms relating to commercial mining of cryptocurrency using blockchain technology and provide sales and use tax exemptions on the tangible personal property and electricity used in it, for a four-year sunset from July 1, 2021, to June 30, 2025.
The bill talks about how the General Assembly actively has been encouraging the use and growth of blockchain technology since 2019 and created a Blockchain Technology Working Group to study the use of blockchain in various sectors.
“The Commonwealth has an opportunity to become a national leader in the emerging industry of the commercial mining of cryptocurrency given its abundant supply of electricity that can be provided at lower rates than most states, and its established infrastructure to provide such energy through the Tennessee Valley Authority and other electricity providers,” reads the document.
The tax imposed is not applied to electricity and tangible personal property used in the commercial mining of crypto.
To qualify for this exemption, an application shall be filed for each location where crypto mining takes place. The application needs to cover the name and mailing address of the person seeking the exemption, a description of the person’s business activities, and the business location where the operations will be located, including the street address, city, and county; and any other information the department may require.
The department will then be issuing a certificate effective as of the date of the application.