Kentucky has passed two laws aimed at positioning it as one of the most attractive destinations in the US for block reward miners. The southeastern state will give tax and energy incentives to miners who they hope will create jobs and fuel economic growth.
House Bill 230, which exempt miners from paying taxes, was first proposed in January by General Assembly representatives Chris Freeland and Steven Rudy. It was proposed to remove the 6% sales tax and 6% excise tax on miners’ equipment and utility bills. The two pleaded with the General Assembly to take the opportunity to make Kentucky a national leader in block reward mining.
The second bill entitles miners to incentives for clean energy systems. In order for miners to qualify for these incentives, they must have at least $ 1 million invested in the state. This bill, proposed in the Kentucky Senate, requires miners to seek exemption from the Treasury Department. “If approved, it must report the fiscal years beginning per fiscal year beginning November 1, 2021, and November 1 of each year thereafter.”
The two bills sailed through the two houses and garnered 74-19 and 84-16 votes in support, respectively. They are scheduled to come into force on July 1 and be at sunset on June 30, 2030.
Kentucky’s regulatory changes won’t come cheap for the bluegrass state. A tax bill on the bill, which will exempt miners from taxes, will reset the state back to $ 9 million. For the purchase of the mining equipment, the miners receive a tax exemption of between 5 and 6 million US dollars. Thereafter, they will continue to use this exemption every year when they replace their equipment, which costs Kentucky up to $ 2 million annually. In addition, electricity exemptions would hit $ 1 million each year.
“This proposal was valued at $ 9,000,000 based on the assumption that at least one new facility would go online in the next year and existing facilities in the state could benefit from the exemption,” the note concludes.
Block reward miners have been criticized for their high energy consumption. However, Kentucky lawmakers believe this won’t be a challenge to the state as it is already producing excess electricity.
Senator Smith, the sponsor of the bill, told colleagues, “We have companies that are sprawling across the country, and they really like Kentucky because these coal companies and other companies have shut down creating excess energy. And so the utilities are busy either increasing your bill that we saw or finding places to use them. “
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