Jump to content

VAT or no VAT?

Recommended Posts

According to CoinDesk on 25th November, the Dutch Ministry of Finance (Jakob Kamminga) has voiced that, quote, «Bitcoin transactions will "probably" be not liable for value added tax (VAT)» and that «this is based on the notion that such exemptions apply to payments instruments, which, if the term is interpreted broadly, may include payments in bitcoin.» [Source].


And this reflects the main problem for me as a merchant to deal with these coins. The law is so ambiguous that planning ahead and accounting sounds more like a lottery than business. Ironically, some officials have expressed that they will tax bitcoins as lottery winnings. Others again, that it will be taxed as a commodity, and yet others that it will count as an equity or wealth. To say it's confusing would be an understatement. It's not easy getting people to trade using bitcoins when there is no real laws regulating it, and the ones that exist and are used are somewhat archaic-- and were written in a time where these payment-solutions were in the blue. 


So what do you guys mean? What would be the best/worst scenarios law-wise? Should these coins be taxed at all? To me, taxing coins would be like putting a tax on people who use inches and feet instead of the meter and litre.

Link to post
Share on other sites

I think part of the goal of bitcoin was to be deliberately confusing in that way.


If the govenrment wants to impose strong Money-Service-Business regulation on Bitcoin use, claim it is a commodity.


If the government wants to claim VAT, claim it is a currency.


Of course, now in the US different branches of the government have started choosing those same contradictory interpretations when it suites their purposes. (IRS: commodity; Fincen: Currency)

Link to post
Share on other sites

Lol lottery winning :)

Maybe they can tax miners like that :)


Some have actually experienced that as far as I know. And yes, it was earnings from mining that was the issue. Can't remember exactly where I read it. Probably on CoinDesk, my main source of bitcoin news. Another approach was made from the head of the Danish national bank; he compared bitcoins to the glass pearls that were widely used to pay off indigenous Americans during the European takeover of the Americas. The good Dane may have a point, however, if this is the "reality" the lawmakers live in.


Lately, things have notched up a step, obviously the lobby has been working hard, with comparison going from glass pearls to gold. Another such, in it self, useless material used for payment. Gold's only real value is its seemingly obvious and truly intrinsic-- but highly artificially defined-- value. It's like with history, of which Napoleon Bonaparte, a grand trader in the field-- once said: «What is history but a fable agreed upon?» 


Comparing bitcoin to gold is more interesting than glass pearls. Not because of dollar value, remember that gold in itself is nearly useless for just about anything. But gold, like the Rai stones of Palau in Micronesia-- is a limited resource, it must be mined, weighed, and its value cultivated, just like Bitcoin and most other such digital coin payment instruments I normally just refer to as «coins». There is by far agreement on the value and availability of gold, and much the same can be said about most cryptocoins.


To tax VAT sounds strange.

To tax it like foreign currency sounds good.


Well, if it is a commodity there is VAT involved. If it's currency there is not. If it's lottery winnings there are special taxes for that. Thing is there are virtually no laws defining what coins are. They can't even agree on what to call them, digital currency or alternate payment, crypto- or bit-payment; glass pearls anyone? Confusing to say the least, but at the same time it's interesting from a bystander's perspective, witnessing the development, and see what it all ends with in the, hopefully, near future.

Link to post
Share on other sites

Indeed. I like the French word for gold, 'Or' I believe although it's an Indo-European language, is related to the Hebrew word for light אור or "Owr" (compare to Eng. Hour, and Ger. Uhr) and the Sumerian city Urim or Ur (in Babylonian Ur simply means City as far as I can see), where they are credited for having standardised and systemised the same units for time and space we still use today, based on the geometric base-60 system, the square and compass, and what they saw as a direct proportional relationship between the human body and the cosmos (no less), as if to chant the ancient mantra «As above so below».


The perimeter of circles and the horizon was divided into 360 degrees, and further into arc minutes and seconds. The proto-calendar for the Sumerian year was divided into twelve months of equal length relating to the lunar month, with intercalary months shot in from time to time to make up for the missing days of the full solar year. And further reflecting the seven astrological "planets" visible to the naked eye-- in a week of seven days named after the Sun, Moon, Mars, Mercury, Jupiter, Venus and Saturn respectfully. Each day was further divided into 24 hours.


In ancient Mesopotamia time meant money, just like today, and the clocks they used were the solar clock, so the link between the Sun and Gold is far from superficial, these guys didn't do anything half-witted. And this whole thing started some 6000 years ago. Things were valued for a given weight in gold and other useless-but-precious metals. Well, copper can be turned into bronze and brass, and silver can be used for mirrors and primitive photography and for cutlery and jewellery.

Link to post
Share on other sites

funny, just thought about making an unit called freihour that equals one average working hour.


To make it simple we can set it as currently 10 Euro and calculate the inflation on it as time comes.


The freihour could be used if we make an basic income or borrow some stuff, or for accounting.




Yea in former time people had true knowledge.


7 Visibilbe planets 7 main body centers + some invisible like the invisible planets for the simple eye. 


Each body center connected to a different layer of experiences.


 «As above so below».


If we humans would just understand what we truly are... 

Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Create New...