According to PANews, the International Monetary Fund (IMF) has proposed a tax increase on cryptocurrency mining and artificial intelligence (AI) data centers to curb emissions and generate additional government revenue. Shafik Hebous, Deputy Director of the IMF's Fiscal Affairs Department, and Nate Vernon-Lin, an economist in the Climate Policy Department, suggested a tax of $0.047 per kilowatt-hour (kWh) for crypto mining. This tax could rise to $0.089 per kWh when considering the local health impacts of mining activities. The proposed tax increase would raise the average electricity cost for crypto miners by 85%, generate an additional $5.2 billion in annual revenue for governments worldwide, and reduce global emissions by 100 million tons annually, equivalent to Belgium's total emissions.
Hebous and Vernon-Lin highlighted that a single Bitcoin transaction consumes as much electricity as an average Pakistani household uses in three years. They also noted that the energy consumption of AI models like ChatGPT is ten times that of a Google search. The IMF officials proposed an energy usage tax of $0.032 per kWh for AI data centers, which could increase to $0.052 per kWh when accounting for pollution costs. These data centers are often located in regions with greener electricity sources. The proposed tax could generate $18 billion in annual revenue for governments.
The IMF officials believe that targeted taxes could incentivize crypto miners and AI data centers to adopt more energy-efficient equipment and practices. However, they emphasized the need for global coordination on tax policies to prevent businesses from relocating to jurisdictions with lower standards. The officials argued that stringent measures in one region could lead to a migration of operations to areas with less stringent regulations.