Chris Jordan, Commissioner of the Australian Tax Authority (ATO), indicated that bitcoins may be considered as money in the future. At an inquiry last week, he reportedly commented on Bitcoin:
“There’s a definition in the Tax Act of money. It’s got to be the legal tender of a country. We can’t say it’s money. If this grows more and more maybe the definition needs to change.”
The treatment of bitcoins as a currency would be viewed as both symbolically and practically favorable by Bitcoiners. In addition to their recognition as money by an official government body, capital gains taxes are avoided and VAT isn’t owed upon their sale. When it comes to other avenues of income, such as through mining, currency and property are treated equally.
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In the US and Canada, Bitcoin is considered like a money equivalent only for the purposes of crimes like money laundering, much to the chagrin of some of the more passionate Bitcoiners.
The comments underscore how difficult it was for the ATO to reach a conclusion in this grey area and how easily it can be swayed. They had finally decided not to treat bitcoins as currency after months of deliberation on the matter, during which the authority reached out to local experts and businesses for their perspective.