What a great year for cryptocurrencies at least so far. First it was China that made moves to strengthen Bitcoin and then it was followed by Russia and now its Australia. The government in its budget summary for 2017-2018 confirmed that it would treat the digital currency just like it treats money.
The government is coming up with ways to do business in digital currencies by eliminating double taxation on the like of Bitcoin.
“The Government will make it easier for new innovative digital currency businesses to operate in Australia. From 1 July 2017, purchases of digital currency will no longer be subject to the GST, allowing digital currencies to be treated just like money for GST purposes. Currently, consumers who use digital currencies can effectively bear GST twice: once on the purchase of the digital currency and once again on its use in exchange for other goods and services subject to the GST.”
Like many other developed nations especially in the West, coming to terms with this has been a difficult road. By removing the double taxation barrier, Australia is joining countries like Russia to try and tap into the potentials of Bitcoin. Seeing as more institutions now accept bitcoin, it’s just a matter of time before it spreads to other parts of the world and more governments come to embrace it.
In the case of Russia for example, the government says it needed to officially recognise Bitcoin in order to fight money laundry through such channels. This would mark the first time a big economy would declare an open interest in a cryptocurrency.