A change to tax law that passed on Thursday means that digital currencies purchased by Australians will no longer be subject to GST.
The law, once it gets royal assent, will apply retrospectively from 1 July this year.
Prior to this, digital currencies were taxed twice - first when it was bought and then when it was used to purchase items subject to GST.
Commenting on the law, Leigh Travers, chief executive of Perth-based blockchain solutions firm DigitalX, said: "The GST reform was created through constructive engagement with multiple parties and DigitalX congratulates the industry and the Treasury for working together to support blockchain innovation in Australia.
"Digital currency is now on a level playing field with older payments systems. It is a big win for the industry and for politics for getting behind innovation.
"This is the original reason why DigitalX co-founded the Australian Digital Commerce Association or ADCA. We wanted to co-advocate a positive policy change such as this. It is pleasing to see that the first goal of the association has now been achieved."