Double Taxation of Bitcoins to End in Australia

March 21, 2016 Taxation in Australia

CANBERRA – Easing the tax burden on Bitcoins will not only help popularize digital currencies, but incite innovation in Australia’s finance sector.

On March 21st the Treasurer of Australia Scott Morrison announced that the government will implement tax changes aimed at preventing the double taxation arising when using digital currencies to purchase goods and services in Australia.

Currently Bitcoins and all other digital currencies in Australia are not treated as traditional currencies, and, instead, are regarded as assets being bartered, when used to make purchases in Australia.

The classification of digital currencies results in GST being paid by consumers when buying digital coins, with additional GST being levied when the coins are subsequently traded for goods or services.

The government will now investigate legislative changes which would eliminate the double taxation, while also brining the trade of digital coins under the scope of AML regulations.

The Treasurer added that an increase in the popularity of digital currencies will also help develop the use of the underlying “blockchain” technology in other financial sectors, including banking, financial contracts, and equities clearing and settlement.

The move to improve the regulation of digital currencies is part of the government’s new push help stimulate the growth and expansion of innovative financial technologies in Australia.

Photo by: BTC Keychain