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Norway Prepares to Reverse Electricity Tax Cut for Cryptocurrency Miners

News Feed - 2022-10-08 03:10:11

Norway Prepares to Reverse Electricity Tax Cut for Cryptocurrency Miners


The Norwegian government is reviewing a proposal to abolish the policy of preferential tax treatment for data centers mining cryptocurrency with cheaper electricity. The executive power in Oslo says conditions have changed and the country needs the energy currently used by miners. Mining Firms Likely to Lose Tax Incentive as Norway Seeks to Save Power, Collect More Tax


Norwegian authorities are on their way to scrap a tax cut that has been benefitting crypto mining businesses for years. They are proposing to get rid of the reduced electricity tax rate for data centers in the Nordic country, many of which are minting digital currencies.


Power for data centers will thus be subject to the general electricity tax rate, the same that applies for other service industries, the government said in an announcement published this week. Finance Minister Trygve Slagsvold Vedum explained the reasoning behind the move: We are in a completely different situation in the power market now compared to when the reduced rate for data centers was introduced in 2016.


In many areas power supply is now under pressure, which causes prices to rise, Vedum elaborated. At the same time, the crypto extraction sector has expanded in Norway. “We need this power for the community. The government will therefore discontinue the scheme,” the member of the cabinet in Oslo was quoted as stating.


Investigations have shown that it is practically impossible to distinguish between electrical energy used for the minting of digital coins and that consumed by data centers for other purposes, the government also noted.


If crypto mining is to be subject to the regular electricity tax rate, the tax cut for data centers must be phased out entirely, officials believe. They estimate that in this case budget receipts will increase by 150 million Norwegian kroner (over $14 million) now and another 110 million kroner (more than $10 million) next year.


The latest development comes after a failed attempt to ban the energy-intensive mining of proof-of-work cryptocurrencies in May of this year. A push in that direction by the far-left Red Party in parliament was rejected by the majority of Norwegian lawmakers. At the time, they also turned down a proposed electricity tax hike for crypto miners. Tags in this story ban, benefit, consumption, Crypto, crypto farms, crypto miners, crypto mining, Cryptocurrencies, Cryptocurrency, Data Centers, Electricity, Energy, Miners, mining, mining farms, Norway, norwegian, power, Tax, tax benefit, tax cut, tax policy, Taxation


Do you think Norway will lose its attractiveness as a crypto mining destination if it scraps the tax cut for miners? Share your thoughts on the subject in the comments section below. Lubomir Tassev


Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration. Current Block Times and Estimates Suggest Bitcoin’s Mining Difficulty Is About to Catapult Much Higher MINING | 15 hours ago Bitcoin Miner Greenidge Seeks to Raise $22.8 Million in Class A Common Stock Proposal MINING | 1 day ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleStudy: MENA Crypto Volumes Grew Fastest Between July 2021 and June 2022 — Turkey Cements Position as Region’s Largest Market Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItToday"s Top Ethereum and Bitcoin Mining Devices Continue to Rake in Profits


As the crypto economy hovers just under $2 trillion in value, application-specific integrated circuit (ASIC) mining devices are making decent profits. While ASIC miners can still mine ethereum, a 1.5 gigahash (GH/s) Ethash mining device can rake in $51.58 per ... read more.Fidelity Investments Launches Crypto, Metaverse ETFs — Says "We Continue to See Demand" Australia to List Bitcoin ETF After 4 Clearinghouse Participants Commit to Meet Stringent Margin Terms Iran to Increase Penalties for Unauthorized Cryptocurrency Mining Ethereum Foundation"s Financial Report Discloses It Holds $1.6 Billion in Assets, 80.5% Held in Ether

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