State Sen. Alison Clarkson has introduced a bill that will allow the creation of limited liability businesses involved in blockchain and cryptocurrencies in Vermont. The new companies will be taxed by the state in any coin they make, and at a low rate of $0.01.
The bill also proposes a study that could see the use of blockchain technology to establish a Vermont e-residency program. It requires officials to study Estonia’s blockchain-based e-residency program. Since that allows citizens to register as e-citizens and digitally sign documents, encrypt and share them as they wish, register entities online, and digitally run a company from anywhere in the world.
“While our state may not have Silicon Valley or Wall Street, it is already a moderate tech hub,” says her husband Oliver Goodenough, who is a law professor at the University of Vermont.
The proposed bill also proposes the use of the technology in insurance and e-banking and creation of trust frameworks to prevent identity theft.
The bill has a high chance of being passed because Vermont has dealt with blockchain-related bills, moving two in 2016 and 2017.
Sen. Clarkson said,
“We have a history of passing innovative laws for business”.
The first passed bill allowed for the use of blockchain in the authentication of objects. Such as artwork, precious stones or high-value footwear. The data can consider as evidence in court. The technology can also be using to supply a notarization of authenticity legally. The second passed bill allows money transmitters to hold digital currencies as a kind of “permissible investment”. But “only to the extent of outstanding transmission obligations received by the licensee in the identical denomination of virtual currency.”
The Estonia e-residency program also allows citizens to virtually apply for third-party services like e-banking and remote money transfers. They can also make an online payment to service providers and declare taxes.
Vermont state has a population of just about 600,000, and it is losing more workers due to outmigration and retirement. The state has been declining economically and in job creation. This bill could help turn around the issues by making Vermont first state to encode legal enhancements for virtual business.
“Our legislation is fairly forward-looking to advance economic development. We desperately want to attract young workers. (This bill) might attract them to be here physically”.
This and other passed two bills will see Vermont continue to lead in this technology.
“We have been busy putting the enabling legislation in place to build fluency”.