Pay Business Taxes in Bitcoin? In Ohio, Yes You Can

Just months ago, the news this month from Ohio’s State Treasurer might not have caused a ripple in Connecticut.  That was before Ideanomics, a global technology company focused on digital asset production and distribution, closed a deal to construct its first “Fintech Village” Center for Technology and Innovation in West Hartford.  Ideanomics is pioneering the new blockchain and AI-empowered economy. In Ohio, that technology has crossed another mainstream threshold.  Ohio has become the first state where businesses can pay their taxes in bitcoin. Bitcoin is the most well-known of cryptocurrencies, which all use distributed ledger technology. Distributed ledger technology -- such as blockchain -- allows users to record data and transactions instantaneously in a way that is mostly unhackable, Governing magazine reported.

Ohio Treasurer Josh Mandel (D) told Governing that he hopes accepting bitcoin for 23 business taxes will be particularly appealing to tech startups and international businesses. He eventually wants to expand payments to individual taxes and other types of cryptocurrencies.

"We want to project to the rest of America that Ohio is loud and proud about embracing blockchain technology," he says, noting that the launch of ohiocrypto.com coincides with a major blockchain conference in Cleveland. "We're trying to plant the flag and send the message to entrepreneurs and software developers across America that Ohio is open for business."

As for Ideanomics, through strategic partnerships with and ownership stakes in leading Artificial Intelligence (AI) and blockchain companies, Ideanomics is plans to bring transparency, efficiency, cost savings and new ownership paradigms to various markets including finance, commodities/energy, vertical industry/supply chain and consumer.

“The government adoption is the latest signal that cryptocurrencies are gaining legitimacy after initially being associated mainly with drug and weapons dealers on the dark web,” Governing magazine reported:    “First, BitPay -- much like currency exchange desks -- locks in an exchange rate and converts the currency to U.S. dollars. That makes the transaction less risky for government.  Second, bitcoin offers taxpayers an option with a lower fee -- 1 percent -- than those associated with credit cards, where there's usually a 2 or 3 percent surcharge for payments to the government.”

Seminole County, Fla., began accepting payments in bitcoin for things like license fees and taxes in late August.  Neither jurisdiction expects to see rapid utilization of the new payment method, Governing pointed out, but both expect to be leading the way for other governments to follow.  Ohio’s current treasurer leaves office in January, to be succeeded by Robert Sprague.

The $5.2 million purchase of land in West Hartford by Ideanomics, formerly the University of Connecticut greater Hartford campus, formally closed with the State of Connecticut and UConn in October.  Plans are to bring 330 new jobs to the town, and to achieve LEED Gold certification from the U.S. Green Building Council by investing in new and environmentally efficient technologies.