Australia Tax Office Proposes Bitcoin Be Considered Money at Senate Inquiry
The Australian Taxation Office (ATO) was invited to present at the Senate inquiry on digital currency, which was started last week by the Senate Economics References Committee (SERC). The inquiry is part of the next stage of formalizing laws around digital currencies in Australia and was approved to proceed by parliament last month.
An 8-page document submitted by the ATO reviews the properties of digital currencies, their impacts and risks, and its draft guidelines on how they should be treated for tax purposes.
Of note is its proposal to consider digital currencies as money, which was spurred by feedback from the community during the comment period. Specifically, differentiation needs to be drawn between "money" and "currency"' in the GST Act. The definition of "money" should be broadened to include anything treated like money in a society, and Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term "satisfies this ordinary meaning of money because it is widely used and a generally accepted medium of Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term."
The document goes on to evoke recent rulings by US courts that effectively treated bitcoin like money, as well as Germany's recognition of bitcoin as a financial instrument in the form of units of account.
By considering bitcoin as "money," it would not be considered a good. Therefore, it would not be subject to GST. According to current guidelines, GST is chargeable on bitcoin sales, much to the chagrin of the local community and the reason for CoinJar's moving shop to the UK.
The consideration would also make bitcoin subject to pay-as-you-go (PAYG) withholding tax when used for wages, as opposed to Fringe Benefits Tax (FBT).
The Australian Taxation Office (ATO) was invited to present at the Senate inquiry on digital currency, which was started last week by the Senate Economics References Committee (SERC). The inquiry is part of the next stage of formalizing laws around digital currencies in Australia and was approved to proceed by parliament last month.
An 8-page document submitted by the ATO reviews the properties of digital currencies, their impacts and risks, and its draft guidelines on how they should be treated for tax purposes.
Of note is its proposal to consider digital currencies as money, which was spurred by feedback from the community during the comment period. Specifically, differentiation needs to be drawn between "money" and "currency"' in the GST Act. The definition of "money" should be broadened to include anything treated like money in a society, and Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term "satisfies this ordinary meaning of money because it is widely used and a generally accepted medium of Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term."
The document goes on to evoke recent rulings by US courts that effectively treated bitcoin like money, as well as Germany's recognition of bitcoin as a financial instrument in the form of units of account.
By considering bitcoin as "money," it would not be considered a good. Therefore, it would not be subject to GST. According to current guidelines, GST is chargeable on bitcoin sales, much to the chagrin of the local community and the reason for CoinJar's moving shop to the UK.
The consideration would also make bitcoin subject to pay-as-you-go (PAYG) withholding tax when used for wages, as opposed to Fringe Benefits Tax (FBT).