Israel Tax Authority: Bitcoin Not a Currency But an Asset

Israel Tax Authority: Bitcoin Not a Currency But an Asset

Bitcoin
February 20, 2018 by Bitzamp
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Israel Tax Authority: Bitcoin Not a Currency But an Asset The Israel Tax Authority (ITA) has issued new guidelines on the taxation of cryptocurrency and cryptocurrency transactions in the country. Bitcoin isn’t a currency and people buying and selling the cryptocurrency will be subject to tax, the Israel Tax Authority said Monday in an updated
Bitzamp

Israel Tax Authority: Bitcoin Not a Currency But an Asset
The Israel Tax Authority (ITA) has issued new guidelines on the taxation of cryptocurrency and cryptocurrency transactions in the country.
Bitcoin isn’t a currency and people buying and selling the cryptocurrency will be subject to tax, the Israel Tax Authority said Monday in an updated circular.

Also Read: India pursues Cryptocurrency holders for Tax

The decision came after the authority issued its draft circular on bitcoin taxation, which similarly discounted claims that bitcoin and its peers are currencies, no different from the shekel or dollar, whose profits are not taxed.

In addition, the tax authority had never issued a final ruling on whether the sellers of cryptocurrencies were liable for the 17% value-added tax. On Monday it clarified that only businesses would be liable for the tax, not individuals, because, as the circular explained, bitcoin is an intangible asset used for investment purposes only.

Shahar Strauss, a tax lawyer with the Tel Aviv firm Ziv Sharon & Company, said he had clients who had invested small sums in bitcoin years ago and today their holdings are worth tens of millions of shekels, after the big run-up in the cryptocurrency’s value. They are now liable for taxes in the millions of shekels.
“The agency’s position ignores economic realities,” he said. “According to the tax administration, investing in the esoteric currency of some countries is a tax-exempt entity, while investing in the digital currency is not the East.”


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