Arizona seeks to exempt virtual assets from taxes…limits taxation of blockchain nodes

An Arizona state senator has filed a bill to exclude virtual assets from property tax and to limit local government taxation of blockchain node operations.

On the 23rd (local time), Cointelegraph reported that, according to bills prefiled in the Arizona State Senate, Senator Wendy Rogers proposed a state-level overhaul of virtual asset taxation through two bills and one resolution. The core measures are to exclude virtual assets from taxation and to relax regulations on operating blockchain infrastructure.

First, the 'SB 1044' bill provides that virtual currency be excluded from state taxation. The 'SCR 1003' resolution would amend the Arizona Constitution's definition of property tax to explicitly exclude virtual assets. Both measures must be approved by voters, and if so, would be placed on the ballot at the next state general election in November 2026.

Another bill, 'SB 1045', centers on limiting taxation of blockchain node operators. The bill would prohibit counties, cities, towns and other local governments from imposing taxes, fees, or fines on individuals or companies operating blockchain-based nodes. This bill can be acted on directly by the state legislature.

Rogers said the legislation is "a move to reduce legal uncertainty around digital assets and distributed network technologies and to make Arizona a blockchain-friendly jurisdiction." In particular, the ban on taxing node operations is interpreted as intended to protect infrastructure activities that are essential to maintaining network security and decentralization.