The Biden administration has targeted cryptocurrency transfers in its tax repression plan

Transfers of cryptocurrencies over $ 10,000 will have to be reported to U.S. tax authorities, according to Biden’s new administrative proposals that tighten the regulatory environment for digital currencies.

The U.S. proposal, part of a broad set of proposals aimed at preventing China’s tax evasion, was introduced a day after China declared regulatory repression of digital currencies.

The price of Bitcoin, the actively traded cryptocurrency, has fallen by 5 percent since the US announced the proposal.

A followed chaotic few hours on bitcoin trading on Wednesday, China’s central bank warned financial institutions to accept cryptocurrencies as payment or to offer related services and products. The price of Bitcoin has dropped to 30 percent after comments, before finally recovering.

The U.S. Treasury has said the cryptocurrency has a “significant detection problem” facilitating illegal activity including tax evasion, “the European Central Bank said in a comment this week, saying the cryptocurrencies are a cause for concern for” illegal use. “

The U.S. proposal, by strengthening Joe Biden’s White House Internal Revenue Service, is part of a report on how Joe White’s White House anticipates closing a “tax gap”. The report is the latest in a series of White House proposals that would lead to wealthier Americans paying much more in taxes.

The Biden administration wants to close the tax gap — the difference between the taxes owed to the U.S. government and those actually paid — by investing nearly $ 80 billion in identifying the IRS and the wealthy people who avoid paying service debt.

The proposals include new reporting requirements for financial institutions, as they should share information with the IRS about all amounts that go into and out of bank accounts, in addition to existing reports.

According to the Treasury, the overall “tax gap” was $ 600 billion last year, and is projected to rise by about $ 7 billion over the next decade if left unaddressed. The Treasury said about 99 percent of taxes owed on wages are paid annually, but to match “less visible” sources of income, those with a higher link to higher earnings (such as property or rental income) are far from estimated to be lower.

According to Treasury estimates, the proposed IRS review would generate an additional $ 700 billion in revenue over the next 10 years, and $ 1.6 billion over the next decade.

The Treasury said the president’s proposals said audit rates would not go up for people earning less than $ 400,000 a year.

The proposals are part of Biden $ 1.8 million American Family PlanAn ambitious parliamentary package, if passed by Congress and signed into law, would lead to a significant expansion of federal funding for child care, higher education, and family and medical leave in the U.S.

The White House has proposed paying the plan, in part, a tax increase of approximately $ 1.5 million to wealthy Americans – including nearly doubling taxes on capital gains that earn more than $ 1 million. The proposed the tax increase has sparked a reaction Among some critics of Wall Street and the American corporation.

Intentions to deal with the tax evasion may be more politically pleasing to Washington lawmakers, especially Republicans who have raised red flags against any of Donald Trump’s 2017 tax cuts.

The White House is the third component of Biden’s broad economic agenda set by the White House last month, following a $ 1.9 billion fiscal stimulus bill signed into law in March and $ 2.3 billion. infrastructure proposals Those being discussed on Capitol Hill.

Republicans have largely rejected the president’s proposals, and have accused Democrats of wasting spending at the risk of rising inflation. GOP senators have offered a counter-proposal of nearly $ 600 billion to the president’s infrastructure package, although Republican lawmakers in recent days have suggested it is open to packages priced between $ 800,000 and $ 900 billion.