The news was delivered following a formal inquiry to the Swiss Federal Tax Administration (FTA) by three members of Bitcoin Association Switzerland, submitted in Feb 2014. FTA’s answer clarified that bitcoin is not seen as a good or service, and is not subject to VAT.
“This is the most reasonable way to classify Bitcoins in the context of VAT and we are fortunate that the tax administration agrees with our view. Bitcoin is a currency, and thus should also be treated like a currency.”
– Luzius Meisser, Bitcoin Association Switzerland President
This is great news for Swiss bitcoiners, who actively trade the digital currency, and bitcoin accepting merchants, as they won’t have to pay tax on the service or good and the transaction itself.
“This is excellent news for Bitcoin in Switzerland as it provides the legal certainty we need to professionally operate our business.”
– Niklas Nikolajsen, Bitcoin Suisse AG CEO
VAT and Bitcoin in Europe
Switzerland joins several other European countries who have clarified their standing on VAT and bitcoin transactions. The United Kingdom, Germany, France, Belgium, Finland, and most recently, Spain have all classified digital currency transactions as exempt from VAT. A decision by the European Union (EU) could clarify bitcoins VAT standing for all European countries, but clarification has yet to be provided.
“Treating Bitcoin payments just like any other payment option is a huge milestone for the Swiss Bitcoin economy, and enriches the global digital money ecosystem.”
– Bernhard Kaufmann, Moving Media GmbH General Manager
It is currently unclear what legislation was cited by the Swiss tax authorities, which are not in the EU jurisdiction. Other European countries who have clarified the matter, and classify digital currencies as VAT exempt, cited EU legislation. “We can conclude from the Granton
Originally appeared at: http://bravenewcoin.com/news/switzerland-reportedly-eliminates-vat-for-bitcoin-transactions/