Ohio Proposes Bill to Exempt Cryptocurrency Payments from State Taxes

On February 24, Ohio lawmakers introduced House Bill 116, aiming to prevent the state from imposing additional taxes on cryptocurrency payments.

The bill, sponsored by Representative Steve Demetriou and co-sponsored by several others, seeks to amend existing laws to ensure that digital assets used for payments are not subject to extra fees or taxes beyond those applied to traditional fiat transactions.

Legislation Aims to Exempt Cryptocurrency Payments from State Taxes

This move positions Ohio as a forward-thinking state in the realm of cryptocurrency payments. The proposed legislation defines “digital assets” to include cryptocurrencies, stablecoins, and non-fungible tokens (NFTs).

https://twitter.com/steve4ohiohouse/status/1882873301326053412

While standard state and sales taxes would still apply to transactions involving cryptocurrency payments, the bill emphasizes that no new levies should be imposed specifically on digital assets.

This clarification aims to provide certainty for businesses and individuals engaging in cryptocurrency payments within the state.

Beyond tax exemptions, House Bill 116 addresses the integration of digital assets into Ohio’s financial ecosystem. The bill mandates that state pension funds evaluate the potential risks and benefits of investing in cryptocurrency exchange-traded funds (ETFs) and report their findings to the General Assembly within a year.

This initiative reflects a growing interest in diversifying investment portfolios through cryptocurrency payments.

The legislation also safeguards the rights of Ohio residents to self-custody their digital assets using hardware or self-hosted wallets. Additionally, it permits individuals to engage in cryptocurrency mining activities, provided they comply with local zoning regulations.

Mining operations are explicitly allowed in industrial zones and cannot be unfairly targeted by local zoning changes. These provisions aim to foster a favorable environment for cryptocurrency payments and related activities in Ohio.

Ohio’s Ongoing Efforts in Cryptocurrency Legislation

This bill is part of a series of efforts by Ohio legislators to integrate cryptocurrency payments into the state’s financial framework. In September 2024, State Senator Niraj Antani introduced a bill allowing taxpayers to use cryptocurrencies like Bitcoin to pay for state and local taxes.

This initiative aimed to position Ohio as a leader in cryptocurrency adoption, following a previous attempt in 2018 that was discontinued due to regulatory challenges.

More recently, in January 2025, Senator Sandra O’Brien introduced Senate Bill 57, proposing the creation of an “Ohio Bitcoin Reserve Fund.” This fund would authorize the state treasurer to invest public funds in Bitcoin, with holdings secured for at least five years.

The proposal also requires state agencies to accept Bitcoin for various payments, including taxes and fees, further integrating cryptocurrency payments into state operations.

The introduction of House Bill 116 and other related legislation underscores Ohio’s commitment to embracing the evolving landscape of digital finance.
Ohio is not the only state embracing cryptocurrency payments.

Utah recently took a similar step, with its House Economic Development Committee approving HB 230. If fully passed, the bill would allow the state treasurer to invest in major digital assets and participate in staking and lending.
This reflects a broader trend of U.S. states exploring crypto-friendly policies to drive innovation and economic growth.