In contrast to proposed regulation that typically make it more difficult for bitcoin startups to thrive, a bill in New Jersey might wind up favoring these companies. As proposed by two members of the assembly, tax and regulatory breaks could be granted to cryptocurrency companies operating in the state.
In particular, Assemblyman Rai Mukherji and Assemblyman Gordon Johnson pointed out that bitcoin startups should be encouraged to run operations since these could trim joblessness in the state. They drafted a 30-page bill to create a regulatory framework for the industry as well.
Benefits for Bitcoin Startups
Prior to this, New Jersey’s Assembly Financial Institutions and Insurance committee had a two-hour meeting to discuss crytpocurrency developments after the state’s Treasury officially recognized the cryptocurrency last month.
According to a report on Star Ledger, the new bill, titled the “Digital Currency Jobs Creation Act,” would qualify companies for up to $5,000 in tax write-offs for each new job they create and exempt Bitcoin companies from having to pay tax on electricity. It would also require companies to have an “effective cyber-security program” and hire a chief security officer.
“The legislation clarifies where digital currency stands sort of in the rubric of New Jersey law. In other states that’s been confusing,” said Mukherji. “I think this would be the first statute of its kind in the country. We would be establishing the framework legislatively.”
In addition, the Digital Currency Job Creation Act could also allow bitcoin startups and individuals to pay their taxes using the cryptocurrency. Of course the bill would require employees, founders and stakeholders who handle any digital currency assets of a company to be fingerprinted by The New Jersey Commissioner of Banking and Insurance. It would also give the Commissioner of Banking and Insurance the ability to fine bitcoin startups up to $5,000 for violations of the act.