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Australia Officially Ends Bitcoin Double Tax

Ali Raza

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Australia Officially Ends Bitcoin Double Tax

Australia just passed a law which will remove the current law that imposes a double taxation on all cryptocurrency transactions. The law is set to implement by July 2018.

According to the current law that was created in December 2014, all Australian citizens were subject to a double taxation for any cryptocurrency transaction conducted. The first taxation, was for the goods and services tax (GST), while the second tax was for the actual cryptocurrency involved in the transaction. The Australian Tax Office defined cryptocurrencies such as Bitcoin as “intangible” property when creating the rules pertaining to it.

CEO of the Australian bitcoin startup, Living Room of Satoshi, Daniel Alexiuc, explained that once an individual pays $4 for coffee using Bitcoin, essentially they pay an extra 40c for GST, and then another 40c just for using Bitcoin.

Despite this counter-intuitive rule, the Australian Treasury has pledged their commitment to finding a better solution for the issue of double taxation. To this end, they released a comprehensive policy titled “Australia’s FinTech Priorities” early last year. In the policy, the Australian Treasury stated that the government is committed to finding a more suited alternative that the current double taxation on cryptocurrencies transactions. The policy suggested that they will reform the law pertaining to GST especially in terms of cryptocurrencies.

The government had also demonstrated that they are truly committed to this cause when they once again addressed this issue in this year’s federal budget.

During September the government introduced the initial bill in an attempt to rectify the current legislative framework which imposes a double taxation on cryptocurrencies. According to The Australian, the bill has been approved by the Australian parliament. According to the Bill, cryptocurrencies will from now on be seen and handled as “foreign currency.”

Ending the double taxation is bound to give cryptocurrency activity a major boost in the country. In addition, the Australian Tax Office has also confirmed that they will investigate the growth of cryptocurrencies as well as blockchain technology to implement into the taxation system, in an attempt to streamline the process.

According to Kevin Hogan, chair of Australia’s House of Representative Standing Committee on Tax and Revenue in New South Wales, since cryptocurrencies are clearly increasing in popularity, the onus rests on governmental and financial institutions to implement regulatory and legislative frameworks that will encourage and monitor the activity. The taxation method is just a part of the larger process.

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Cryptocurrencies: Tighter Regulations In Europe

Samantha Mitchell

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Cryptocurrencies: Tighter Regulations In Europe

The Background

As changes and upgrades in Cryptocurrencies continue to occur and the industry develops, so do the regulations surrounding this new concept.

The European Parliament unanimously this week voted – by a large majority – to support a December 2017 agreement around the use of Cryptocurrencies. The total regulation of Cryptocurrencies is moving closer and closer. This will be great for all concerned and sets a firm precedent in how things are moving forward in this industry.

The European Parliament members voted to agree with the European Council regulations on vital issues such as the prevention of the rise of Cryptocurrencies in money laundering as well as terrorism. The vote was a very clean and redefining moment with 574 for yes and only 13 for no, with 60 absentees.

This is a very strong message for the European community not only addressing anonymity of financial services but also implementing rules on exchanges and platform providers. Now it means that everyone has to be registered with the authorities and will have to apply for due diligence procedures – including customer verification – before receiving the OK from the government. Quite a big moment for the European community.

Moving Forward

The new regulations will not take long to put into force… in fact, they will be running in three days as stated in the Official Journal of the European Union. Once this is in place, the member states will have 18 months to bring all of these new country laws into their constitutions. However, it is not expected that it will take this long to implement these new laws, as countries are very keen to protect themselves against the evils of Cryptocurrency as soon as possible. There are many robberies, kidnapping, and the likes already being reported and industry is eager to protect itself as soon as possible to alleviate a huge crime wave before it actually hits. Changes are absolutely vital in the prevention of money laundering, tax evasion, and criminal activity. As experts highlight, criminals have not stopped, and there is still a lot of bad behavior going on, whether it is laundering or finance terrorism, it is still happening all the while there is money to be gained. This new legislation just solidifies things, helps to support those living in the country and makes them feel safer.

Governments are completely exposed at the moment with Cryptocurrency because it is such a new industry and so completely unknown. There are also so many ways to exploit the system. Until the industry settles down and becomes more stable, with government officials realizing where the loopholes are, this is going to be a tricky road ahead. These tougher measures will hopefully break open the duty of financial companies and help them to undertake due care and diligence. However, this is absolutely not a given. Money laundering and tax evasion is rife no matter where you are in the world and especially so in a new and developing industry.

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Crypto Mining: The South Koreans Are Tightening The Import Of Crypto Mining Chips

Samantha Mitchell

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Crypto Mining: The South Koreans Are Tightening The Import Of Crypto Mining Chips

Importing Mining Chips Is Getting Harder

Following the huge influx of mining chips over recent months, the Korean Customs Service has now implemented stricter rules on the import of these chips. This will make it harder for the Cryptocurrency miners in South Korea to get these internationally produced chips sent into the country.

The Korean Customs Service has now listed mining chips as an item, which needs to meet their regulations before they are released into the country. The chips will be scrutinized against current laws as well as safety and sanitization certifications before they are allowed into South Korea.

These new rules have been implemented following the upsurge in imports recently. It has been reported that in November and December 2017, approximately 1.3 billion Korean Won ($1.2 million) worth of mining chips were imported into the country. The Korean Customs Service stated that this amount was spread through 454 imports of mining chips.

Why The Changes And Concern?

As is well documented and known, the industry is still very much unknown, and suppliers / providers are being very cautious because of this simple fact. The South Koreans are just being careful at the moment and ensuring that nothing untoward happens to the mining machines once they have entered the country. There is a large amount of power consumption and heating required to run these machines, and the Korean Customs Service will be double checking everything to alleviate any possible fires from breaking out around the country as a direct result of mining. This is even more important when you consider that there is very little known about just how much power is required to run these machines.

Going forward, there will be strict examinations of mining machines whenever they enter the country. Safety will be the main area of concern and machines will be assessed based on the laws of the importation of electronic goods. The laws were implemented and are governed by the National Radio Research Agency.

There is widespread worry that illegal mining activities will raise electricity costs in the country and increase the risk of fire if not controlled well. Again this is very much an unknown. Both the public and private sectors have shared their worries and are now working hard to restrict illegality. This is certainly a hot topic for the South Korean Police who have already arrested 14 individuals from 13 companies for accessing cheap power to mine Cryptocurrencies. This was further to the banning of mining Cryptocurrencies inside of a building of a retail marketplace in Seoul earlier in the year. Nothing actually caught fire, but there was anxiety that something would and that the power/building would overheat.

Although South Korea is one of the first to implement such sanctions on importation, it will not be long before others follow suit. Something that must now be expected as this merging market expands. Countries and governments will continue to be attentive when it comes to mining until more about the industry and its effects are known.

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Cryptocurrency: The Japanese Market Really Soars

Samantha Mitchell

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Japan-yen-bitcoin

The Japanese Financial Services Authority has just released it’s latest findings which are quite surprising and heavily focused on Cryptocurrency.

The results have been compiled from 17 Cryptocurrency exchanges in Japan and really do show how things are moving in Japan. There are now over 3.5 million active crypto traders in a population of 127 million (2.76%).

The Results Are In

From the latest survey results, the majority of crypto traders are in the age brackets of 20 to 40 years old. 34% of these are in their 30s. The most traded currencies at the moment are: Bitcoin; Ethereum; Ripple; Bitcoin Cash; Litecoin.

The plain facts alone are astounding. Bitcoin annual trading has shot up from $22 million to $97 billion between 2014 and 2017 alone. It has also been reported – even more impressively – that Bitcoin being traded as an underlying asset has seen an even higher rise from $2 million to $543 billion in exactly the same time frame. Three years. These figures speak for themselves and prove officially that Japan is indeed leading the way in Bitcoin trading. This statement is now unquestionable with the facts above.

ICO Regulations

All of the above is being supported wholeheartedly by the Japanese government who are facing the regulation of this industry full on. Unlike China and South Korea – who have currently banned ICOs completely at the moment – Japan is fully accepting ICOs and is continually researching the impact of ICOs on the country. China and South Korea have chosen to take a slightly more weary modus operandi and stop all activity whilst they are completing a detailed investigation into this new concept. However, in Japan, a government-backed research group is already looking at the regulation of ICOs and how to manage the applications coming in daily. Guidelines are being put into place to ensure a consistent approach. As with all things Japanese, the research is thorough and the guidelines cover aspects such as the prevention of money laundering through investor identification, improved cybersecurity, and insider trading. A couple of these are major hotspots in ICO ie. money laundering and the prevention of fraud so it is refreshing to see that Japan is facing this head-on.

The whole world is watching Japan at the moment as they could very well be setting a precedent for the legalization of ICOs. Other countries are keen to see how the regulations will affect the industry and what the impact will be. It is already well known that regulation is very much needed because the industry is so new and so exposed. This was proven earlier in 2018 when the Japanese exchange was hacked for a reported $550 million worth of NEM tokens. This is still regarded as the largest ever theft in Cryptocurrency.

In a totally unknown world, it will be interesting to see how the groundbreaking efforts of the Japanese really do affect their Cryptocurrency trading. As research confirms, the country now has the world’s biggest Bitcoin trading market and the government is doing everything in its power to manage and support its growth.

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