The tax administration of israel published a circular on February 19, clarifying the fiscal policy of the country on the crypto-currencies, and particularly on the Bitcoin. Currently, the Bitcoin and other digital currencies are at the centre of discussions to put in place tax systems covering the financial technology. The different actors are being discussed for the development of a circular final on virtual currency and the value added tax (VAT).
Below are the details of this case in English :
A real step forward for Israel
In the past, the tax administration of the country has adopted a very clear position towards the Bitcoin. It is considered as a property and not a currency. Israel is the jewel in the economic of the South-West Asia, that is usually printed among the countries in favour of innovation. Israel is now trying to enter on the market of crypto-currencies. Since 2013, the israeli government tries to put in place a mechanism to regulate this sector. Even the country’s Prime minister opens currently with this new technology. The tax policy israel could be a global model.
Source : Steve Buissinne, Pixabay. The Bitcoin is not a currency, but an asset.
The measures taken will put an end to the income tax. Businesses should not State that the tax on the profits. The VAT is applied with a rate of 17 % in Israel. The integration of this kind of fee for the crypto-currency is a major step forward for the market. This allows to control the sector and investors operating on the market.
The Bitcoin will be subject to VAT
The electronic accounting of the VAT is regulated by law in the country. As such, a means of payment distributed is an intangible asset. Thus, individuals wishing to invest in crypto-currencies will not be subject to VAT. This is not the case for companies.
By the way, if one particular operates in the area, and that it achieves a turnover similar to a company, it will be considered a financial institution. In this case, the VAT will then apply.
Source : NewsBitcoin