Topic: Will there be a government tax on virtual currencies? (Read 663 times)
The government's ability to tax Bitcoins is equivalent to their ability to tax Euros or Rubles for that matter. They will however, try to tax any profit earned from investing, just like with the stock market.
The fact that the Bitcoin economy even exists and continues to thrive indicates to me that what the US government thinks (or any government for that matter) about Bitcoin will become more and more irrelevant as we ride this rollercoaster. The future of government looks like this:
Quote
Another man duck-walks across the flight deck.... He's about sixty, with a dirigible of white hair that was not ruffled in any way by the downdraft.
"Hello, everyone," he says cheerfully.
"Who are you?" Tony says.
The new guy looks crestfallen. "Greg Ritchie," he says.
Then, when no one seems to react, he jogs their memory. "President of the United States."
"Oh! Sorry. Nice to meet you, Mr. President," Tony says, extending his hand....
"Frank Frost," Frank says, extending his hand and looking bored.
"Don't mind me," Y.T. says, when Ritchie looks her way. "I'm a hostage."
-From "Snowcrash"
"Hello, everyone," he says cheerfully.
"Who are you?" Tony says.
The new guy looks crestfallen. "Greg Ritchie," he says.
Then, when no one seems to react, he jogs their memory. "President of the United States."
"Oh! Sorry. Nice to meet you, Mr. President," Tony says, extending his hand....
"Frank Frost," Frank says, extending his hand and looking bored.
"Don't mind me," Y.T. says, when Ritchie looks her way. "I'm a hostage."
-From "Snowcrash"
It's a separate currency not run by the US. It's subject to it's own market and can't be regulated like the US dollar. It'd be tricky for any government including the US to put a tax on a currency.
The US doesn't really tax the dollar; it taxes income. The source doesn't make too big a difference. That's why, for example, the guests on Oprah's show that were given "free cars" had to claim the cars on their tax returns as income. Even though they weren't paid in USD, it was still income for tax purposes.
Taxing exchanges seems like a more viable option than trying to tax people for holding and using the currency. Large money making organizations make pretty attractive targets for governments facing sequestration. Maybe that's part of the reason the major exchanges aren't located in the U.S.
The U.S. Government already has a tax on any profit earned through bitcoin. Are you saying they'll create additional taxes?
Just like the "bearer bond" earlier in the last century, since it is hard to to trace and tax people, US decided to tax the "coupon" directly (by The interest paid on any such bonds issued after 1982 would be non-tax-deductible by the issuer in the case of corporate bonds, and taxable income to the holder in the case of municipal bonds",http://en.wikipedia.org/wiki/Bearer_bond), then the receiver of the bond's coupon is expected to pay another layer of tax as income. ( They still need to require to report it, though you can guess some are not reporting anyway, but they are supposed to report to that income as the regulation stand)
The U.S. Government already has a tax on any profit earned through bitcoin. Are you saying they'll create additional taxes?
It's a separate currency not run by the US. It's subject to it's own market and can't be regulated like the US dollar. It'd be tricky for any government including the US to put a tax on a currency.
buy US government can tax its own land in whatever way they want and put official "sanctions" to corporations that do not follow their rule (even in land where the local government said it is legal to do so)
It's a separate currency not run by the US. It's subject to it's own market and can't be regulated like the US dollar. It'd be tricky for any government including the US to put a tax on a currency.
Let's go and see
I believe that in the years to come, major governments, such as the US government, will (or perhaps have already) come to the conclusion that trying to make bitcoin illegal would be starting another currency war which they are not sure to win, as bitcoin doesn't really need to be "made legal" to exist, and because it poses many legal challenges that they are not ready to confront, such as the fact that bitcoin isn't legally money, etc.
BUT...
the US government (among others) will probably try to TAX all virtual currencies (and particularly bitcoin), and this new tax could make exchanges operating in the US unprofitable, which would drive them out of the US. Then they could try to use their influence to try to persuade other countries to do the same.
However, I believe that this will ultimately fail, too. But it could do some damage to the BTC exchange rates in the years to come.
Any idea on this?
BUT...
the US government (among others) will probably try to TAX all virtual currencies (and particularly bitcoin), and this new tax could make exchanges operating in the US unprofitable, which would drive them out of the US. Then they could try to use their influence to try to persuade other countries to do the same.
However, I believe that this will ultimately fail, too. But it could do some damage to the BTC exchange rates in the years to come.
Any idea on this?
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