U.S. Republican lawmakers urge repeal of virtual asset staking taxation rules

Republican members of the U.S. House of Representatives urged the administration to withdraw the current tax rules on virtual asset (cryptocurrency) staking rewards.

On the 19th (local time), according to Decrypt, a media outlet specializing in virtual assets, the Republican members argued in a letter that the rule that immediately taxes staking rewards as income should be scrapped before it applies in the 2026 tax year.

The rule, introduced by the U.S. Internal Revenue Service (IRS) in 2023, treats rewards received through virtual asset staking as taxable income at the moment they are received. As a result, tax is imposed at the time staking rewards occur.

The virtual asset industry has pointed out that this taxation method does not fit the technical characteristics. The industry maintains that staking rewards should be regarded as newly created assets and that it is appropriate to tax them at the actual time of sale.

Republican members argued that the current rule places an excessive burden on individual participants and network security contributors. They stressed that unclear tax standards could suppress innovation and participation across the virtual asset industry.

This demand could lead to discussions for a comprehensive review of the virtual asset taxation system in the future.