- Defended in the case will pay $830,000 in taxes from the $2.5 million made from Bitcoin sales.
- Bitcoin and other cryptocurrencies have “a long way to go” to be treated as actual currencies for tax purposes.
The cryptocurrency space in Israel has been forced to deal with a ruling in a case that involved a tax dispute between the country’s tax authorities and the founder of a blockchain-based startup. This follows a major court case in May where a defendant argued that the $2.5 million made after the sale of BTC was not subject to tax.
The defendant wanted Bitcoin considered as a currency instead of a currency and that Bitcoin sales should have a tax-exempt since “Currencies are notably exempt from taxes on value fluctuations whereas assets are not.”
An Israeli District Court in Lod went ahead to disagree with the argument and how Bitcoin was being characterized. However, the court did not go into the nitty-gritty of speculating the value of Bitcoin and whether it will be used as a currency in the future. According to the court, the current law regards such a coin as Bitcoin to be an asset and not a currency.
The defendant was then ordered to pay $830,000 to the tax authorities. The court further stated that Bitcoin and other cryptocurrencies are far from being regarded as actual currencies at least for tax purposes.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.