PHOENIX — If your tax evasion scheme involved bitcoin or other cryptocurrencies, the Arizona State Legislature would like to have a word with you.
That’s because a Senate bill would make everyone’s favorite internet money subject to capital gains taxes at the state level. This is the second week of the session, and the Legislature has a number of bills floating around that penalize fake service animals, start a hemp production program, banning conversion therapy, as well as the aforementioned bitcoin bill.
Now who said government isn’t responsive to the times?
Dispelling “Magic Internet Money”
Virtual currencies, known as cryptocurrencies, have surfaced into the public consciousness due to the meteoric rise of bitcoin (though the value has been very volatile — dropping several thousand dollars in the last couple days). Bitcoin and other cryptos have earned a reputation as “magic internet money” due to the method in which they are earned: using computer power to solve exponentially difficult equations to earn valuable coins.
However, the IRS and Arizona Department of Revenue have been slow to adapt to this now-lucrative type of commodity trading. Sen. Warren Petersen (R-D12) and Representative Jeff Weninger (R-D17) have introduced SB 1145 to regulate money made from trading cryptocurrencies as part of capital gains.This defines a virtual currency as a “digital representation of value” functioning as “a medium of exchange, a unit of account, or a store of value.”
Sorry day traders, looks like you’ll be taxes like the rest of us.
Killing Conversion Therapy
Conversion therapy, the practice of trying to change someone’s sexual orientation or gender, has been used as a tool to fight homosexuality and transsexuality. The efficacy of the practice hasn’t been established and the American Psychiatric Association has denounced any such therapy and it’s currently illegal in five states.
Enter Sen. Sean Bowie (D-D18) with SB 1160. Sen. Bowie has introduced legislation that would open psychotherapists to disciplinary action if they practice conversion therapy on minors, even if they are willing and have parental consent. While this wouldn’t make it illegal, it could have a chilling effect on professionals willing to provide conversion therapy.
Is That Really a Service Dog?
Most public places have a sign and clear policy: no pets, except for service animals. Crafty pet owners have circumvented this pet prohibition by buying vests for their dogs and claiming them as service animals. If you’ve seen someone carrying a Chihuahua wearing a “service animal in training” vest, this is probably why.
It’s currently a federal crime to misrepresent a pet as a service animal, though enforcement of that is rare. Sen. John Kavanagh (R-D23) has introduced SB 1040, which amends the Arizona rules regarding service animals by adding in a penalty for fraudulently identifying a pet as a service animal. The bill made it through committee and will soon be heard by the Senate and then the House. If passed, the bill would tack on a civil fine of $250 for misrepresenting a pet as a service animal.
It might still be a bit rude to ask someone if their dog really is a service animal, but there may soon be a penalty if Fido is playing dress up.
Helping Out Hemp
The marijuana plant can be used for more than just getting high, and the state of Arizona might benefit from it. The production of industrial hemp, which is marijuana lacking in THC concentration (the compound that makes it a drug) has applications in textiles that make it a viable agricultural product. Following that line of reasoning are 42 Arizona legislators, who have introduced SB 1098 to establish an industrial hemp growing pilot program.
This program would allow the Department of Agriculture and “institutes of higher learning” to research the potential production of hemp in the state. This is a tricky issue, given that the cultivators have to be mindful of U.S. law related to marijuana in addition to the state regulations. The licensing of cultivators and the usage of seed would be run by the Department of Agriculture, alongside any oversight and inspection of hemp growing facilities.
The point? SB 1098 passed 5-2 in committee, and if passed in the House and Senate, the program could pave the way for commercial hemp production in the state. Doing so opens up another textile crop, which means Pima cotton might make way for fields of green — just not the green stoners are looking for.
Erik Kolsrud is the Don Bolles Fellow covering the Legislature for Arizona Sonora News, a service provided by the school of journalism at the University of Arizona. Reach him at ekolsrud@email.arizona.edu.