Ohio businesses are in for some big changes this week — they will now be allowed to pay taxes with Bitcoin.
The state launched ohiocrypto.com as a portal for businesses in the state to pay a range of 23 taxes which include cigarette, sales, and commercial activity taxes.
Ohio’s Treasury office will use the third-party processor, Bitpay, to process the Bitcoin payments, which are converted into U.S. dollars and deposited into a state account.
Ohio’s move is the first in the nation, while Georgia, Illinois, and Arizona have similar programs in the works.
“It’s a very interesting move,” said Phillip Dancy, a New York-based investment banker. “It’s still surprising because Bitcoin could and probably will take another hit.”
Bitpay assumes all of the risks in Bitcoin pricing, according to the OhioCrypto website. Bitcoin users also pay taxes on the cryptocurrency because it is considered a commodity in the U.S.
“I think this is a brilliant decision and natural progression for bitcoin users to pay their taxes online with cryptocurrency,” said CEO and Co-founder of Beyond Capital Markets McKenzie Slaughter. “Plus the transaction is quick and easy, its a win-win everyone involved.”
Businesses interested in using theOhioCrypto portal must register through the website and use cryptocurrency wallets to make transactions. OhioCrypto is compatible with 10 cryptocurrency wallets including BitPay Wallet, Copay Wallet, and BTC.com Wallet.
Slaughter said that she has apprehensions about if Ohio’s government has protocols in place for human mistakes — for example, a business paying a tax with the wrong crypto wallet.
Businesses must have a tax profile with the Ohio Treasurer’s office before they can register in OhioCrypto. Businesses pay a transactional fee of 1 percent, a miners fee, and a network fee. All transactions take three to five business days to process through the portal.