Australian investors are currently paying double tax for the transactions in digital currencies. The Fintech industry experts have been criticising this for a long time. When will Australia Cryptocurrency Double taxation be removed?
20 September, AtoZForex – Australian authorities are now putting efforts to remove the double taxation for digital currencies. Currently, anyone who is intending to perform any transactions of cryptocurrencies in Australia needs to pay double taxation. How come this taxation is still in place?
Australia Cryptocurrency Double taxation
So far, any user of digital currencies had been taxed two times per transaction. The Australian cryptocurrency taxation scheme includes two steps:
- The tax for the good and services (GST) on the product
- The tax for the GST that is levied on the cryptocurrency that was used for the payment or for the purchase.
For instance, if you pay $5 in BTC for an item, you will end up paying 50c GST for the coffee and another 50c again for the Bitcoin you used to pay for the item. The Australian government has pledged to remove the double taxation in March 2016. However, the authorities were delaying the actions for a long time.
Thus, the Australian Fintech community as criticized the long-lasting delay. The experts have called it “a very stretched-out and outdated approach towards taxes for the cryptocurrency community”.
When will Australia Cryptocurrency Double taxation be removed?
Daniel Szetho, the CEO of the industry lobby group and collective Fintech Australia has commented:
“It’s one of the original priorities we put in the reform paper and one they said yes to. But here we are, 14 months on and still nothing.”
Finally, the drafting and the legislation are put forward by a bill presented by the Australian government. The draft proposes the elimination of the double taxation for the digital currencies. Scott Morrison, Australia’s Treasurer, has highlighted the move by the Australian officials:
“Action that will further cement Australia’s reputation as a global Fintech center. The bill will ensure that Australians are no longer charged GST on purchases of digital currency, allowing it to be treated the same way as physical money for GST purposes.
The law change will retrospectively apply from 1 July 2017, in line with the 2017 budget announcement.”
The bill now will need to get the parliament’s approval to become the national law. As of now, there is no clear information about the exact dates of the bill processing.
Notably, in spite of the delay, this news come as a very optimistic update for the Australian investors. Experts expect a boost in the Australian digital currency market activity.
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