Governor Brian Sandoval has signed the Nevada Senate Bill 398 into law, making Nevada the first state in the United States to ban blockchain taxes, CoinDesk reported.

Filed by Senator Ben Kieckhefer in March this year, the bill seeks to prohibit a local government from taxing or imposing restrictions upon the use of the blockchain technology. The bill was sent to the Governor’s office after it unanimously passed both the state Senate and the House of Representatives.

"A local governmental entity shall not: (a) Impose any tax or fee on the use of a blockchain or smart contract by any person or entity; (b) Require any person or entity to obtain from the local governmental entity any certificate, license or permit to use a blockchain or smart contract; or (c) Impose any other requirement relating to the use of a blockchain or smart contract by any person or entity."

The bill also proposes a blockchain or a smart contract to be deemed as an electronic record, noting that "if a law requires a record to be in writing, submission of a blockchain which electronically contains the record satisfies the law".

"A smart contract, record or signature may not be denied legal effect or enforceability solely because a blockchain was used to create, store or verify the smart contract, record or signature," the bill states. "In a proceeding, evidence of a smart contract, record or signature must not be excluded solely because a blockchain was used to create, store or verify the smart contract, record or signature."

Earlier this year, Arizona Governor Doug Ducey has signed the bill HB 2417 into law, thereby recognizing blockchain signatures and smart contracts under state law. More recently, Delaware Senators introduced a bill seeking to legally recognize electronic databases, including those created on blockchain, for the creation and maintenance of stock ledgers and other business records.