Bitcoin is tax-free, European court ruleshttp://www.telegraph.co.uk/technology/news/11948222/Bitcoin-is-tax-free-European-court-rules.htmlEurope's highest court has declared that Bitcoin is exempt from VAT, giving a huge boost to its potential as a rival to established currencies.
Purchasing and selling Bitcoin must not incur the sales tax, the European Court of Justice said, declaring that Bitcoin transactions are similar in nature to those of other "currency, bank notes and coins used as legal tender".
Ruling that Bitcoin transactions were liable for sales tax would have been a significant blow, squeezing liquidity by making it much more expensive to buy and sell the virtual currency.
"The Court’s decision squarely places Bitcoin and similar digital currencies within the ambit of financial transactions," said Judith Rinearson, partner at law firm Bryan Cave. "It will make it easy for commerce to grow in this area."
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