Italian Officials Prepare Bitcoin Taxation Guidelines

The country of Italy is currently dealing with a looming banking crisis. The majority of its loans are not performing and are borderline junk. Despite those concerns, the topic of Bitcoin and regulation has to be touched upon as well. Local taxation official recently drafted a proposal to tax Bitcoin transactions in a corporate environment.

Similarly to most other countries in the world, Italy has no clear legal definition for Bitcoin. It is not an official currency, nor a commodity. However, it has value and anything valuable can be taxed. Up until this point, there was no significant debate on whether or not Bitcoin taxation would go into effect in Italy.

Bitcoin Taxation is On The Horizon

Everything was rosy for Bitcoin in the country, up until September 2nd. At that time, the local taxation office drafted a proposal to introduce bitcoin taxation. This is not the most popular decision they will ever make, but it has not gone into effect just yet.

For now, the proposal only seems to focus on companies dealing with Bitcoin and other cryptocurrencies. This approach is similar to what most other countries in the world have been doing. Consumers and other individuals who deal with Bitcoin will not be subject to this proposal, assuming it becomes a law in the end.

One thing to keep in mind is how the Italian taxation office seems to be well aware of value gains, or losses Bitcoin brings to the table. This means that companies who hold part of a transaction in Bitcoin will also be taxed on its surplus value if the price rises. A similar concept could be applied to individual cryptocurrency owners later on, though.

While this is nothing more than a proposal, it is in contrast to the EU ruling on Bitcoin. For now, the European Union has deemed Bitcoin exempt from taxation. Italy seems to go against the grain in this regard, although it remains unknown what will come of this decision. More information will be made available as this proposal goes through the official channels.

Source: ForexInfo

Header image courtesy of Shutterstock