Israeli Lawmakers Want Bitcoin as Currency, Not Asset

Four members of the Israeli parliament, the Knesset, have moved for a bill proposing amendments to the country’s tax codes to eliminate capital gains tax from digital currency earnings.

The Israeli tax laws currently see Bitcoin and other digital currencies as assets, so any conversion of them into local fiat would bring taxes according to the set capital gains rates.

Currently, Israeli individual investors have to pay a capital gains tax of 25 percent on most assets, but if the proposed bill is passed, this will be decreased significantly.

All the legislators behind the bill tabled on Tuesday are members of the nationalist political party, Yisrael Beiteinu. They claimed that the regulatory situation in Israel around digital currencies is not prepared, and thus, it will not match the industry requirements.

“[Digital currencies] will remain the engine of growth that will enable the technology industry to grow and flourish,” the translated summary of the bill stated.

Moreover, one of the bill sponsors argued on the advantages of using Blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term technology for promoting digital payment options during the ongoing Coronavirus pandemic.

Debates on Crypto Taxation

After long legal uncertainties and fights between the pro-crypto groups and governments, the Israeli government declared Cryptocurrencies Cryptocurrencies By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw By using cryptography, virtual currencies, known as cryptocurrencies, are nearly counterfeit-proof digital currencies that are built on blockchain technology. Comprised of decentralized networks, blockchain technology is not overseen by a central authority.Therefore, cryptocurrencies function in a decentralized nature which theoretically makes them immune to government interference. The term, cryptocurrency derives from the origin of the encryption techniques that are employed to secure the netw Read this Term as assets in 2018, bringing some clarity in the industry. That was cemented last year as an Israeli court recognized Bitcoin and other digital currencies as assets, not currencies.

Meanwhile, the crypto tax debate is still hot across the world as regulators are struggling to tax digital currency gains properly. While reporting of incomes from the virtual currency is an issue, regulators are fighting to properly define cryptocurrencies.

Notably, most of the countries levy capital gains tax on crypto gains. South Korea recently amended its tax laws to charge a flat 20 percent tax on all crypto incomes.