Bitcoin Exempt From VAT Says European Court of Justice 72
An anonymous reader writes: The European Court of Justice (ECJ) proposes that Bitcoin should be exempt from Value Added Tax (VAT). This news has been positively received by the Bitcoin community in the EU, as member states are not likely going to apply VAT to purchases and sales of Bitcoin. A clear cut argument brought up by Advocate General Juliane Kokott, was that VAT is commonly applied to goods and services which have an end consumer. Bitcoin is neither a good, nor a service and has no end consumer, as Bitcoins are eternally transferable just like normal currency. Bitcoin exchanges such as Coinbase, Kraken, Bitstamp, and Bitfinex will all benefit from this ruling, which may lead to other countries across the globe to follow a similar approach.
Can I do my groceries with bitcoin yet? (Score:4, Funny)
Bitcoin is a cool thing in theory, but when can I exchange it for money that shops actually accept, so I can do my groceries with it?
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Interpret the downvotes as "I don't like the question, but I don't have an answer".
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when can I exchange it for money that shops actually accept
Of course you can exchange it for money that shops actually accept.
What's not happened yet.... is.... most shops won't yet provide acceptance of Bitcoin directly for goods.
However, you can exchange some BTC yourself for cash in your local currency. There also may be some options where you fund a prepaid credit card using BTC, Or accounts where you charge the CC transaction and they convert from a held BTC balance.
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If I have to exchange it for other currencies, doesn't that negate the whole point of bitcoin?
Let me duck that for you: bitcoin gift card (Score:2)
I think the idea is to search the web for bitcoin gift card (let me duck that for you [duckduckgo.com]) and then cash in your Bitcoins for credit at your favorite stores.
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You've been able to buy gift cards with Bitcoin for years (I did it to unload my Bitcoin long before the taxman regulated it), but then you're probably stuck paying VAT again for your purchases.
So much for using Bitcoin as a tax dodge in that case.
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I think the idea is that you don't have to pay VAT for the bitcoins themselves because they're currency, but you still have to pay VAT for what you buy with them because what you buy with them are goods.
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Well, maybe you have not understood what the purpose of Bitcoin is? For example, it can also not be used as a substitute for toilet paper....
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I get a 404
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Dollars are not accepted by my supermarket :)
Can I exchange bitcoin for euros?
Re:Can I do my groceries with bitcoin yet? (Score:4, Informative)
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An actually informative post about nanocard would include a link to nanocard: https://www.ccedk.com/nanocard [ccedk.com]
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Looking at the karma moderation history of my first comment, it does seem that way.
Except (Score:1, Troll)
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"economically and technologically flawed" ...which is also just like a normal currency. ;-)
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Not quite, BTC has no leverage to implement monetary policy. The result is that there is no way to counteract severe inflation and deflation. Some people think that this is a good idea; either because "market powers" or because it means they can trade (gamble) it like a stock.
In addition, the amount of power required to validate transactions ("mining") is astounding. The primary reason why paper money was introduced is to detach the money generation from it's value.
All things considered, yes BTC is economic
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Couple of things:
> There's more wrong than that. The creators of the protocol are of the shared mentality that any inflation is bad, thus bitcoins have a fixed supply.
Mentality is not really relevant. You could say that of any fixed supply instrument. Once the last gold nugget is mined gold is deflationary. Now, if you told me gold is a terrible basis for a currency....I would AGREE with you. However, that doesn't mean it is useless as an economic instrument. Not everything is liquid currency or needs to
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Its wealth redistribution from everyone....right into the pockets of the already wealthy! Is it any wonder there are enough people fed up with it to create little niche markets like bitcoin?
It's no wonder. In fact, it's surprising more people aren't upset. Don't get me wrong, bitcoin has great intentions. I was very enthusiastic about it in the begining, but ultimately it's problems are too great to overcome. Ultimately I don't believe you can have a healthy decentralized economic system.
The biggest problem the west has economically is simple: corruption. Or more accurately I think: flawed fundamentals compounded by corruption. The most flawed of which being private enterprise controlling e
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If I were in a position of authority I would propose a gradual transfer of power from the private sector to a national central bank. Something like an increase on the fractional reserve ratio for all private enterprise by 2% per year until it hits 100. "New money" should then only be lent out by the central bank through private institutions acting as brokers. Profits from loans then go into the public treasury. Interest rates can then be controlled by a central authority who's core interest in is the welfare of the people, rather than shareholder profits. Periods of increased economic growth would result in increased social and public infrastructure spending, while periods of slower growth result in higher rates that help deflate bubbles and encourage saving.
There are fundamental problems with this scheme. The first is that a central authority is always far more subject to corruption than a large number of smaller entities. In many ways, centralizing things simply makes a bigger, easier target for the predators out there (some of whom usually end up in control of it).
The second is that no central authority knows what is best for the people. In many cases, nobody knows what's best. The world is a complex place, and there are many different viewpoints. A dec
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I'm Canadian so I'll use my country as an example. In the public s
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Except it does not apply to currencies, because as the name says it is value ADDED tax. What is exactly taxed is the amount that was added from buying to selling the good. For example a shop buys chocolate for 0.5 a price and sells it for 1. The shop will then pay the VAT on the 0.5 that was added. As a consumer you don't see this, because you pay the VAT for each step and originally the value stared with 0. This is complicated by the technicality that the bulk of the VAT is actually payed by the store sell
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The point being that bitcoin is simply not recognised by court as a valid currency. VAT is about paying in currency.
And mind you, only idiots paint "Europeans" as some kind of a monoculture. We have Greek who openly say that the only way they will pay taxes is through foreign oppression and then you have people who think that paying taxes is a great way to fund wide reaching social security for everyone.
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It's not a rationalisation. It's fact. There is no VAT in barter.
Re:Strange (Score:5, Insightful)
What are you talking about? Your statement is the opposite of what happened.
The court basically said "Yeah, that's basically like money" - meaning it's not a product itself but can be used to acquire other products. *Those* products are still subjected to VAT, as should be, but bitcoin itself isn't.
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Interesting. If so, this spells doom for the primary goal of bitcoin, that being anonymity as any seller would need to collect VAT from buyer and file it with his government.
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No, but it has to surrender its own information to the government for taxation purposes.
Much of raison d'etre for bitcoin is gone if seller is not anonymous.
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No, but it has to surrender its own information to the government for taxation purposes.
Much of raison d'etre for bitcoin is gone if seller is not anonymous.
Bitcoin was not designed for selling drugs, and protecting that is not a goal in itself, plus drug dealers are already breaking the law which is why they want to hide there ID, they can break VAT laws too.
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Remember what they got Al Capone for?
Yeah.
Re:Strange (Score:4, Interesting)
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Well, one would argue that a country suffering from rapid currency devaluation would continue (and even accelerate devaluation) if people were able to trade in other countries' currencies easily (I don't think your universal panacea of BC trade happens anywhere, but lets just play along). What you're really saying is the savy locals get by on working/bartering in USD, Euro, raw BitCoin (more stable currencies), while everyone else at home can suffer with savings being eroded further by your selfishness. See
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but in many 3rd world countries with unstable national currencies, it has done wonders.
Citation required. Given its very low volume, I am go out on a limb and say no. It has done literally almost nothing.
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Any non-under-the-table sales over a certain amount must identify both parties, in many jurisdictions. Small purchases don't require that.
This ruling has no impact on anonymity: If something was to be kept off the radar, it sure as hell wouldn't be bothered with taxes and government bureaucracy. If it's just something small that should be kept quiet, nobody bothers or is forced to collect information about the buyer.
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Except for VAT payment, which requires buyer to identify himself and pay the tax. Welcome to real world. Especially in current climate in EU, where tax dodging caused a significant tightening of enforcement of tax code across many jurisdictions.
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Of course the seller has to identify himself. The people selling stuff and seriously thinking about paying taxes are not the same people who'd rather not show up on the government's radar.
As I said, nothing changes, other than bitcoin being grouped with real currencies and not products.
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Previous post should read "seller" obviously.
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Purchasing gold bullion doesn't require paying VAT either:
https://en.wikipedia.org/wiki/... [wikipedia.org]
So it makes sense to do the same for Bitcoin.
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That would be because you cannot use gold as a direct payment currency any more easily than any other trade goods. It's a trade good, and trade for gold would be barter.
You could pay with gold after you denominate it in a currency for its value just like with any similar item (i.e. oil, platinum, diamonds), but that raises all kinds of questions about the denomination, its values, and potential for taxation and regulation.
But the specific tax known as VAT is only added when goods and services are sold to a
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This news has been positively received by the Bitcoin community in the EU? Europeans and their fanbios never hesitate to point out that they like paying taxes because they love all their public services. I would have thought they would welcome a nice fat VAT charge on their Bitcoin exchanges.
I know you're trolling but don't worry instead of VAT we get to pay capital gains tax like on other investment vehicles like savings accounts, stocks and bonds. And wealth tax too, if you declare it as you're legally obligated to if it's over a certain amount. If you're making money, you can be sure the government knows to get a piece of the action. The IRS does too, but on this side of the pond we occasionally see useful public services in return.
Re:Really? (Score:4, Informative)
Bitcoin is STILL a thing? There's STILL idiots out there who thinks it has any value and willing to pay for it?
Wow... Just... Wow.
Yes, it still has value. Even more so now that the craze has died down. It is used more and more like a currency rather than for speculation.
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> It is used more and more like a currency rather than for speculation.
I know some places say they accept Bitcoin as a payment method. However most of them quickly convert it to dollars or another currency. Is there a demand from users to be able to pay in Bitcoin instead of their regular currency? I can understand that need when buying things where privacy is really needed (illegal drugs etc.), but for regular stuff?
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However most of them quickly convert it to dollars or another currency.
The important thing is they accept it for trade, Not that they choose BTC as a long-term store of value. Surely anyone can see how that could create undesirable risk.
Merchants might accept BTC, but most of their suppliers, including employees and the tax man are going to want their payments denominated in local currency.
The _exchange_ is exempt (Score:2)