It's more income. So ... more taxes. Think of it like the grocery bag tax in the affluent suburbs. We do need more "investment" in schools ... so this is a win for society, right?
As one of the comments points out, this is very specifically related to miles given as "interest" or "account-opening bonus" on a bank account. For years any non-cash payment in those circumstances has been required to be valued as cash and reported on a 1099, to avoid savings accounts or CDs that dodge taxation of dividends by paying them in various alternative forms, e.g. a savings account that pays interest in Amazon gift cards instead of cash, or a $200 account-opening bonus that's given as a free iPod instead of in cash.
Miles received for buying plane tickets, or as reward miles on credit-card spending, aren't considered taxable or reported. It's both cases, the form (miles or cash) doesn't matter, but what they're given for does: rebates aren't considered taxable, whether given in loyalty points or in 1% cash-back or some other form, but interest on a bank account is.
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[ 0.24 ms ] story [ 13.0 ms ] threadMiles received for buying plane tickets, or as reward miles on credit-card spending, aren't considered taxable or reported. It's both cases, the form (miles or cash) doesn't matter, but what they're given for does: rebates aren't considered taxable, whether given in loyalty points or in 1% cash-back or some other form, but interest on a bank account is.