Great news for all crypto holders in Germany come from the German Federal Ministry of Finances that has (finally) attempted to consider Bitcoin as tax-exempt as long as it is used when making purchases.
The German federal authority published the decision, relating to all cryptocurrencies and taxes. It also cites the European Court’s 2015 decision which acted as a precedent for all the members of the EU (European Union).
According to the court, cryptocurrencies are already a legal means of payment:
“So-called virtual currencies (cryptocurrencies such as Bitcoin) are considered equal to the legal means of payment, as long as these so-called virtual currencies have been accepted as alternative and contractual means of payment by the parties involved in the transaction and have no other purpose than being used as a means of payment.”
The decision considers any conversion from crypto to fiat or vice versa as “other taxable services”. In this manner, any party that is acting as an intermediary for the exchange won’t be taxed. Additionally, operators of any crypto exchanges can get tax exemptions, but only “if they complete the purchase and sale of Bitcoin as an intermediary on their behalf.”
The court decision also considered the miner fees, seeing them as tax-exempt too since they are paid on a voluntary basis. All of these guidelines have made Germany a leader in the crypto field and a distinguished country from many others – for example the US where the IRS sees Bitcoin like property and where the leading cryptocurrency is subject to capital gains tax.
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