Colorado becomes the first state in the US to accept tax payments using crypto.
Colorado Department of Revenue, a state agency responsible for collecting taxes and issuing state ID cards and driver's licenses, has allowed Coloradans to pay their state taxes using crypto.
According to the news report written by Axios Denver, Colorado Governor Jared Polis announced the news during the first day of Denver Startup Week.
"Cryptocurrency has been modified as an additional payment option for taxpayers who are ready to complete their online transactions to pay for their state taxes on Revenue Online,” said Polis.
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Residents can now use cryptocurrencies to pay for their individual income, sales and use, severance, business income, withholding, and excise fuel taxes.
Colorado also accepts payments in more traditional forms such as cash, credit or debit cards, checks, ACH credit, E-check, and money orders.
Coloradans can pay their taxes using cryptocurrencies through PayPal Cryptocurrency Hub. After PayPal receives tax payments, it will immediately convert digital assets to US dollars and transfer them to the Department of Revenue.
However, if residents want to pay their taxes using cryptocurrency, they will have to pay additional fees. PayPal will take $1.00 as a service fee and 1.83% out of the total payment amount.
Moreover, there are additional requirements. The payments can be made only from personal accounts and using one cryptocurrency. The Department of Revenue currently accepts Bitcoin (BTC), Bitcoin Cash (BCH), Ether (ETH), and Litecoin (LTC).
Governor Jared Polis is an active crypto and digital innovations advocate. Polis has been actively involved in cryptocurrency legislation. Moreover, the governor has issued non-fungible tokens (NFTs) to allow his electorates to contribute to his reelection campaign. At the time of writing, Polis sold 176 NFTs, retailing for $52.80 each.
In the United States, apart from Colorado, the state of Utah has been working on allowing residents to pay their statewide taxes using crypto. The program is expected to be launched on January 1st, 2023, and will be regulated by the Utah Division of Finance.