Though, the earlier indications were not positive for Bitcoin in Australia as the government was tough against the digital currencies, the latest review from Senate Economics References Committee that considered digital currencies in Australia and says that they are like any other currencies, gives a lot of encouragement to the supporters.
The committee reviewed that digital currency should be treated like any other currency for the purposes of the Goods and Services Tax (GST). Many people who support the cryptocurrencies believe that this is a positive sign for financial technology startups. This move can set the stage for the digital currency Bitcoin to be treated like regular money in Australia.
A Greater Clarity on Bitcoin is expected to come
As has been mentioned above the result is contrary to the position of the Australian Taxation Office (ATO), which ruled in 2014 that Bitcoin was a commodity, “neither money nor a foreign currency,” and was liable for the GST, as well as other taxes. Thus, Bitcoin has been on the topsy-turvy path over the months in Australia.
Nonetheless, the ATO’s guidance was met with dismay by Australia’s nascent Bitcoin business community last year as many startups were warned that they would have to move overseas to avoid the debilitating financial penalty. It appears the wrong has been undone now as the government agencies will have to clear their stand on Bitcoin.
Bitcoin can provide Level playing Field
The committee concluded that the ATO had placed “an additional burden on Australian digital currency businesses.” Labor Senator Sam Dastyari, Chairman of the committee admitted that the Australian Financial Review hoped the finding would help keep digital innovators at home in Australia.
He was quoted saying:
“Without a doubt, the main benefit will be the confidence and certainty that removing a GST will provide to our own digital entrepreneurs, and the foreign businesses who want to set up here. Most importantly, it will send the message to local tech entrepreneurs that their government is listening to them, and that in itself is a major step forward.”
Interestingly, the committee that received submissions from 48 groups and individuals, including Ripple Labs, an online payment transfer company that is currently working with the Commonwealth Bank of Australia.
The company found that harmonizing a global standard for digital currencies could provide clarity and an even playing field for technologists and companies that innovate using digital currencies.
To contact the reporter of this story: Deepak Tiwari at email@example.com