New Poland Cryptocurrency Tax Bill Clarifies Taxes on Bitcoin Income and Transactions
The Polish government has started a new draft to make things clear when it comes to taxes on cryptocurrency in Poland. Clarifications for tax purposes range from discussions about decentralized virtual currencies to those implemented on centralized money exchanges. Even cryptocurrency mining has been taken into consideration for the newly developed taxation of a digital cryptocurrency.
Poland’s government has forged a new document covering income tax on cryptocurrencies like Bitcoin. Other related fields are covered in the draft as well, all the newly developed taxes can be seen on the official doc on the Polish Governments legislation website. Usage by the Council of Ministries is underway for mainstream application of the draft by the end of the year, 2018.
Laws covering the process of taxing cryptocurrency is included in the new legislation, particularly those covering taxes related to capital gains made from crypto trading.
Poland’s governing party made decisions to virtual currencies early in the year. The government is pushing for mandatory taxes on cryptocurrency, regardless of profits made or lost, something crypto-users in Poland are in sharp disagreement with. Other parties in disagreement with the governing party are the Finance Ministry of the country, who sees the push as extreme. Due to the dispute by different government parties – including the Civil Law Transactions Tax – specifically regarding cryptocurrencies, the law on taxes will be postponed until a joint resolution can be agreed upon.
One clarification in the definition of virtual currency, something also covered in the Act on Countering Money Laundering and Terrorism Financing. According to the draft, there are now two distinct groups of digital currencies; the first is cryptocurrency, second is virtual currency. Definitions for both types of currency are drafted in the federal document, including issues covering the legality of each and their associated methods of exchanges. Other areas covered are how they can be used for payment purposes and stored or transferred.
According to the document, cryptocurrency transactions will not be taxed on a personal and business level. Transactions that result in personal revenue gain will be taxable, including those made on exchanges and various e-commerce platforms. And sales made using cryptocurrency will also be taxed as well. Basically, any transaction that results in someone making profits will result in taxes.
However, simple cryptocurrency exchanges will not be taxable by the Polish government. Lastly, any mining operations that result in a party gaining profits will be taxable, including commissions made by mining operations using third-party investments to fund the operation. What Poland’s government is making is required by cryptocurrency investors to report any profits made on their yearly earnings report.
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