According to the guidance, released Tuesday by the Ministry of Finance, Germany has said that they won’t tax Bitcoin users for consuming the cryptocurrency as a means of Payment.
The new German official documents stated that Bitcoin would treat unvaryingly to legal tender for tax purposes when used as a means of payment. Also, cryptocurrencies can consider as the legal method of payment.
“Virtual currencies become the equivalent to legal means of payment. Insofar as these so-called virtual currencies of those involved in the transaction as an alternative contractual. However, immediate means of payment has been accepting”.
As per the document, it is a taxable miscellaneous benefit when crypto is exchanged into a fiat currency. Nevertheless, an arbitrator or mediator for the exchange will not put tax. But when a consumers purchase a product or service with Bitcoin, an article of the EU’s VAT Directive will come to the force to the price of the Bitcoin during transaction time.
Additionally, the document also lists that payment fees sent to digital walletproviders or other services can add tax. Miners will not have to pay tax, as their services are considering to be optional.
An individual will receive a tax exemption who acts as an intermediary to buy and sell Bitcoin. Meantime, an exchange operating as a technical marketplace will not obtain any such tax exemption.
Originally published at coinpedia.org on March 1, 2018.
