Arizona state Senator Wendy Rogers has introduced two bills and one constitutional resolution aimed at limiting how digital assets and blockchain activity are taxed across the state.
The proposals seek to exempt virtual currencies from certain taxes and restrict local governments from imposing levies on blockchain infrastructure.
One bill, SB 1044, would amend Arizona statutes to exempt virtual currency from state taxation if approved by voters.
A second bill, SB 1045, would prevent counties, cities and towns from taxing or fining individuals or businesses that operate blockchain nodes.
The accompanying resolution, SCR 1003, proposes changing Arizona’s constitution to explicitly exclude virtual currencies from property tax definitions.
Rogers prefiled the legislation with the Arizona Senate, signalling an early push ahead of the next legislative session.
While SB 1045 could pass through the legislature alone, SB 1044 and SCR 1003 would require statewide voter approval.
Arizona voters would be asked to decide on the proposed tax changes during the general election scheduled for November 2026.
Supporters argue the measures could provide regulatory clarity and make Arizona more attractive to digital asset firms.
Critics have raised concerns about potential revenue losses and uneven treatment compared with other forms of property.
Arizona already has legislation allowing the state to claim ownership of abandoned digital assets after three years.
That law was linked to broader efforts by crypto advocates to establish a state-level digital asset reserve.
Rogers previously co-sponsored a Bitcoin reserve bill that was vetoed by Arizona Governor Katie Hobbs in May.
The senator criticised the veto and said she intends to reintroduce the proposal in a future legislative session.
Other US states are also pursuing varied approaches to digital asset regulation and taxation.
Ohio lawmakers have considered exempting small crypto transactions from capital gains tax, though the bill has stalled.
New York legislators have proposed a new excise tax on digital asset transactions, which has yet to advance.
At the federal level, Senator Cynthia Lummis submitted draft legislation proposing tax exemptions for small digital asset gains.
Lummis has since announced plans to retire from the US Senate in January 2027.
At the time of reporting, Bitcoin price was $88,454.41.