Friday, 20 October 2017 12:02

Law passed to stop double taxation of digital currencies


Australia has passed legislation to stop the double taxation of digital currencies such as bitcoin.

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.

In an explanatory memorandum that ran to 25 pages, Treasurer Scott Morrison said: "The legislation amends the GST law so that digital currency receives equivalent treatment to money, in particular foreign currency."

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."

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Sam Varghese

Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

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