Global Shift Towards Crypto Taxation
2019 will go down in history as a hallmark year for the taxation of cryptocurrencies. The global consensus that cryptocurrencies are here for the long haul became more evident as governments around the world scrambled to draft, amend, and implement crypto tax regulations. From the undeniable reality that crypto is regarded as an asset to the diverse approaches taken by various countries, it became clear that avoiding crypto taxation is becoming nastier than regular tax evasion.
North America: From Guidance to Acceptance
The year was packed with action in North America regarding crypto tax legislation. In the United States, the IRS celebrated their first birthday of chasing down crypto traders with new guidance that made it easier to report crypto holdings.
- IRS Guidance: IRS sent out letters to thousands of cryptocurrency investors, reminding them that Uncle Sam will always be watching. Revenue Ruling 2019-24 and 43 FAQs became bedtime stories for taxpayers.
- Bermuda’s Bold Step: Bermuda stepped into the future as the first government to accept USD Coin (USDC) for tax payments. Talk about embracing modernity while sipping on piña coladas!
Europe: A Mixed Bag of Regulations
Europe was a land of contrast for crypto taxation, with countries adopting various stances.
- Portugal: The shining star for crypto traders, Portugal declared that individual traders won’t face taxes on crypto transactions. This makes it a tax haven for crypto investors, reinvigorating the age-old dream of living on beaches instead of towers.
- The UK’s Traditional Stance: HMRC clarified that crypto assets are not currencies, hence they don’t need a seat at the royal banquet table, but they still come with a capital gains ticket.
- France Takes the Cake: France made waves by removing taxes on crypto-to-crypto trades, promoting a less convoluted taxation system.
Oceania: Keeping Up with the Herd
In Oceania, Australia and New Zealand kept pace with their Western counterparts, positioning themselves as serious players in the crypto taxation arena.
- Australia: The Australian Taxation Office deemed cryptocurrencies as property, leading to capital gains tax duties that snuck up on traders.
- New Zealand’s Perspective: While crypto-assets won’t be considered money, salaries paid in crypto still need to abide by tax regulations. Quite an oxymoron, don’t you think?
Asia’s Diverging Paths
Asia’s approach was equally varied, running the gamut from strict regulations to welcoming tax exemptions.
- China: Despite a crypto ban, a court case recognized Bitcoin as virtual property, hinting at potential legal recognition down the line.
- Singapore: Announcing that crypto transactions won’t incur Goods and Services Tax, Singapore is paving the way to a friendly tax environment.
Latin America: Reporting Requirements Galore
In South America, Brazil showed the most interest in monitoring its citizens’ crypto transactions with an iron fist.
- Brazil’s Rules: Citizens were ordered to report every single crypto transaction—talk about feeling a bit too much like Big Brother monitoring your financial choices!
Conclusion: The Year for Crypto Clarity
To sum it all up, 2019 was definitely a game-changing year for crypto taxation worldwide. As more rules are set, taxpayers can expect to see an uptick in compliance and, who knows, maybe 2020 will bring even more clarity and growth in tax filings. For now, it’s all eyes on how these policies evolve, and whether governments can keep their promises of a collaborative future in crypto taxation.
