Thursday, October 22, 2015

EU Court of Justice Rules Bitcoin is a Currency

The European Union’s Court of Justice (ECJ) has today ruled that Bitcoin is a currency, detailing exchanges that transfer traditional currencies into the crypto-coins for a fee are to be exempt from consumption taxes.

Under the EU rule against value added taxes (VAT) on transfers of “currency, bank notes and coins used as legal tender,” the new call presents an important boost for Bitcoin, erasing related costs for buying and using the virtual funds in Europe – one of the world’s leading trading zones.

Today’s decision concludes a long-standing discord in Europe over how best to regulate Bitcoin. The UK’s tax authorities took the position that it is a currency, while other countries, including Sweden and Germany, believe that Bitcoin is a commodity and transfers should therefore be subject to sales taxes. Poland levied a 23% VAT on all exchanges – maintaining that Bitcoin is an exchangeable product, not a currency.

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