Bitcoin Will Kill The Income Tax

[vltnqefi]

Well, agree, free currency doesn't need tax

[hgmichna]

First, governments will increase their tax base, beginning 2017-01-01, by obtaining account information from most financial institutions, which includes bitcoin exchanges. They are required to report account data to the home tax authority of each account holder.

Details on Reddit

[Blitzboy]

In the end, governments will always get their taxes one way or another, by hook or by crook. That is for certain. Unless the country is like one of the rich Gulf States with oil and doesn't need to collect taxes to pay for its infrastructure, public works, police, education, healthcare, national security, etc.

We may not notice it but government in where we are living ( where taxes are in anything ) it is being implemented and being put in each product that we used... Even if we are using bitcoin, the local exchange that we are using is paying taxes in the government and the way we cash our bitcoin out to fiat, we are paying tax each time we use the remittance centers and banks too...  

No one can deny the fact that taxes are included in everything, but for bitcoin, it's something different. Bitcoin isn't under control of any government agencies or any companies or even anyone, so there is no point in paying tax for bitcoin. Have you ever wonder where those "bitcoin's taxes" goes or what happens to them. So I don't think that bitcoin has tax or that it should be taxable.

[Senor.Bla]

In the end, governments will always get their taxes one way or another, by hook or by crook. That is for certain. Unless the country is like one of the rich Gulf States with oil and doesn't need to collect taxes to pay for its infrastructure, public works, police, education, healthcare, national security, etc.

We may not notice it but government in where we are living ( where taxes are in anything ) it is being implemented and being put in each product that we used... Even if we are using bitcoin, the local exchange that we are using is paying taxes in the government and the way we cash our bitcoin out to fiat, we are paying tax each time we use the remittance centers and banks too...  

No one can deny the fact that taxes are included in everything, but for bitcoin, it's something different. Bitcoin isn't under control of any government agencies or any companies or even anyone, so there is no point in paying tax for bitcoin. Have you ever wonder where those "bitcoin's taxes" goes or what happens to them. So I don't think that bitcoin has tax or that it should be taxable.

Bitcoin is not partially made of taxes, just like any other form of money is also not. You would not say 1 USD is 98 cents + 2 cents taxes.
But you pay (or at least should pay) taxes for everything you buy. The same goes for money i earn (this is btw what we are talking about Income Tax).
So if i buy a car or make some money with my job, then i (unless the seller and my employer do it for me) have to give a portion of the money to the government. It does not matter what i buy or in which currency i pay/get paid. I have to convert it to the currency my government accepts and pay it.  And so if i want to buy some Bitcoin and my government has decided to tax this, then i have to pay the taxes. Nobody wants to do it, but this is the way it is.

[olubams]

It will never kill the income tax or any other service of the governments if the governments legalize bitcoin for their affairs and provide different facilities for the usage of bitcoin in the state especially the states need to start their own wallets so they will perform their duties for the currency of bitcoin and they have to allow banks to use bitcoins.

Thats my same position. So far we need government to legalize Bitcoin they will never do anything that will jeopardize their own selfish interest or that will write down their popularity and influence and thats what will happen if Bitcoin should kill income tax which is one of the main source of government revenue. Unless they are able to get ways to tax that Bitcoin, then I see them banning that form of currency in no time...

[Zadicar]

It will never kill the income tax or any other service of the governments if the governments legalize bitcoin for their affairs and provide different facilities for the usage of bitcoin in the state especially the states need to start their own wallets so they will perform their duties for the currency of bitcoin and they have to allow banks to use bitcoins.

Apparently, that's not going to happen. The government will not start legalizing bitcoins. Simply talking about bitcoins would expose it to the public and that's something that the government don't want to happen. When that happens, people would know the truth that you can avoid paying all these expenses issued by the government. Most people don't want to pay income tax since it takes a huge percent of your income and there's 12% VAT in literally everything that we buy.

I think people would start accepting bitcoins because a lot of people are looking for it and not because the government said so.

Yeah nowadays people are searching for the ways where they have not to pay the taxes etc especially in the third world countries where the government do not spend these income on their public but on their ministers and for their luxurious life. But if the governments got a time to research about bitcoin and if they found a way for working with bitcoin then they will readily adopt bitcoin.

Most people who live on 3rd world countries would really find a way to evade tax because the already know that their government is corrupt and doesn't imply or use the tax on the right way and I do agree on what to have said they will just use it for themselves and also if they found out about bitcoin they will surely ignore or block it because of the threat regarding tax evasion.

[Foref1982]

I don't think that Bitcoin will kill your income tax. The reason why I think it won't kill it because we won't ever be fully within Bitcoin network in our daily lives. For instance, the issue of salaries. Bitcoin's too unstable for most people to get their whole salaries in. I regularly invest into Bitcoin, but that's just a small part from my salary. I wouldn't invest all my salary into it lol...

[The_Dark_Knight]

I don't think the government will be outsmarted by some businesses. When they start to notice that there is a decrease in their income tax they will know the source of the problem, they might even count as using Bitcoin as Tax Evasion. Anything that is a source of a company's income is taxable including Bitcoin of course.

Governments are outsmarted by business all the time, many of the biggest business in the world pay not tax at all thanks t complicated schemes used by their lawyers that is why some governments are fighting for something they call harmonization of taxes which basically means all the governments of the world will tax you at a particular rate of your income and as you may guess the countries where you pay no tax disagree with it.

The government has all the resources to determine who are not a tax payers but they just don't act on it when corruption are involve. It normally happens in a poor countries where public officials are corrupt and they just accept bribe from corrupt businessman as well.

It's different in bitcoin as it is decentralized and it can never be corrupted by government, it's either they adopt or they will hate bitcoin by banning it.

Corruption may be an issue, but the biggest businesses take advantage of the laws on different countries to not pay taxes, so it is not only a problem of corruption, big business have big money they can use to circumvent the laws.

Income tax is not supposed to be evaded even if you are using bitcoins! Income tax is tax on your income. Hence if you do earn from bitcoin, no matter where you are you should be paying income tax. The concept is quite easy. You earn, you pay for income tax. Even if your source of revenue is from illegal activities you have to pay for income tax. The government will realize you are not paying income tax the moment you overspend outside of your means. For example, a big corporation acquired a multimillion dollar servers without even declaring a single cent to the government. That would be investigated outright.

In fact it matters where you are, in many jurisdictions you don't need to pay income tax that comes from foreign sources, basically you don't pay income tax on income that comes from other countries, so you are mistaken about that.

[Positid]

I don't think the government will be outsmarted by some businesses. When they start to notice that there is a decrease in their income tax they will know the source of the problem, they might even count as using Bitcoin as Tax Evasion. Anything that is a source of a company's income is taxable including Bitcoin of course.

Governments are outsmarted by business all the time, many of the biggest business in the world pay not tax at all thanks t complicated schemes used by their lawyers that is why some governments are fighting for something they call harmonization of taxes which basically means all the governments of the world will tax you at a particular rate of your income and as you may guess the countries where you pay no tax disagree with it.

The government has all the resources to determine who are not a tax payers but they just don't act on it when corruption are involve. It normally happens in a poor countries where public officials are corrupt and they just accept bribe from corrupt businessman as well.

It's different in bitcoin as it is decentralized and it can never be corrupted by government, it's either they adopt or they will hate bitcoin by banning it.

Corruption may be an issue, but the biggest businesses take advantage of the laws on different countries to not pay taxes, so it is not only a problem of corruption, big business have big money they can use to circumvent the laws.

Income tax is not supposed to be evaded even if you are using bitcoins! Income tax is tax on your income. Hence if you do earn from bitcoin, no matter where you are you should be paying income tax. The concept is quite easy. You earn, you pay for income tax. Even if your source of revenue is from illegal activities you have to pay for income tax. The government will realize you are not paying income tax the moment you overspend outside of your means. For example, a big corporation acquired a multimillion dollar servers without even declaring a single cent to the government. That would be investigated outright.

In fact it matters where you are, in many jurisdictions you don't need to pay income tax that comes from foreign sources, basically you don't pay income tax on income that comes from other countries, so you are mistaken about that.

I don't know what country are you living, but what I know is that we have to pay taxes whenever there is a transaction that one involves to earn income and that is regardless if it's domestic or foreign transaction.

[Sir Alpha_goy]

Bitcoin you will be taxed and you will love the income tax.

[Gliassa]

In the end, governments will always get their taxes one way or another, by hook or by crook. That is for certain. Unless the country is like one of the rich Gulf States with oil and doesn't need to collect taxes to pay for its infrastructure, public works, police, education, healthcare, national security, etc.

We may not notice it but government in where we are living ( where taxes are in anything ) it is being implemented and being put in each product that we used... Even if we are using bitcoin, the local exchange that we are using is paying taxes in the government and the way we cash our bitcoin out to fiat, we are paying tax each time we use the remittance centers and banks too...  

Indeed it will not change anything if you are asking me, its just not gonna happen, they will at the end implement of course.

[shinratensei_]

First, governments will increase their tax base, beginning 2017-01-01, by obtaining account information from most financial institutions, which includes bitcoin exchanges. They are required to report account data to the home tax authority of each account holder.

Details on Reddit

So, there is no privacy for the users? Looks like the government was pressuring the service business for releasing something has needed a protection. and this will be running in the wrong way. But i don't think they will be reporting all of the data.

[Kasplant]

In the end, governments will always get their taxes one way or another, by hook or by crook. That is for certain. Unless the country is like one of the rich Gulf States with oil and doesn't need to collect taxes to pay for its infrastructure, public works, police, education, healthcare, national security, etc.

We may not notice it but government in where we are living ( where taxes are in anything ) it is being implemented and being put in each product that we used... Even if we are using bitcoin, the local exchange that we are using is paying taxes in the government and the way we cash our bitcoin out to fiat, we are paying tax each time we use the remittance centers and banks too...  

Can also not agree more they will find a way and there will always be taxes no matter what even if the bitcoin get more used and will used for a global currency there still will be taxes people!

[hgmichna]

First, governments will increase their tax base, beginning 2017-01-01, by obtaining account information from most financial institutions, which includes bitcoin exchanges. They are required to report account data to the home tax authority of each account holder.

Details on Reddit

So, there is no privacy for the users? Looks like the government was pressuring the service business for releasing something has needed a protection. and this will be running in the wrong way. But i don't think they will be reporting all of the data.

There are still around 100 countries that are not participating. The odd man out is the US, the only very large country not participating, but only because they already have their own reporting system in place: FATCA. But OECD CRS is wider in scope.

Unfortunately most bitcoin exchanges are in jurisdictions that participate in the OECD CRS, so most of them will likely report to your tax authority. Check the document for the definition of Reporting Financial Institution in the Annex, Section VIII, and you can decide for yourself whether there is any chance for a bitcoin exchange to escape this regulation.

Of course the bitcoin exchanges do not warn their customers, because they are afraid of a mass exodus before the end of 2016. Some banks did warn their customers though. An example from a Suiss bank (Saxo) is here.

[The_Dark_Knight]

I don't think the government will be outsmarted by some businesses. When they start to notice that there is a decrease in their income tax they will know the source of the problem, they might even count as using Bitcoin as Tax Evasion. Anything that is a source of a company's income is taxable including Bitcoin of course.

Governments are outsmarted by business all the time, many of the biggest business in the world pay not tax at all thanks t complicated schemes used by their lawyers that is why some governments are fighting for something they call harmonization of taxes which basically means all the governments of the world will tax you at a particular rate of your income and as you may guess the countries where you pay no tax disagree with it.

The government has all the resources to determine who are not a tax payers but they just don't act on it when corruption are involve. It normally happens in a poor countries where public officials are corrupt and they just accept bribe from corrupt businessman as well.

It's different in bitcoin as it is decentralized and it can never be corrupted by government, it's either they adopt or they will hate bitcoin by banning it.

Corruption may be an issue, but the biggest businesses take advantage of the laws on different countries to not pay taxes, so it is not only a problem of corruption, big business have big money they can use to circumvent the laws.

Income tax is not supposed to be evaded even if you are using bitcoins! Income tax is tax on your income. Hence if you do earn from bitcoin, no matter where you are you should be paying income tax. The concept is quite easy. You earn, you pay for income tax. Even if your source of revenue is from illegal activities you have to pay for income tax. The government will realize you are not paying income tax the moment you overspend outside of your means. For example, a big corporation acquired a multimillion dollar servers without even declaring a single cent to the government. That would be investigated outright.

In fact it matters where you are, in many jurisdictions you don't need to pay income tax that comes from foreign sources, basically you don't pay income tax on income that comes from other countries, so you are mistaken about that.

I don't know what country are you living, but what I know is that we have to pay taxes whenever there is a transaction that one involves to earn income and that is regardless if it's domestic or foreign transaction.

Well, obviously I’m not going to tell you where I live, this is a bitcoin forum and that means that we are anonymous conscious, but I will give you an example, in Panama you pay income tax on the income generated within the country but every income that comes from outside of it does not pay any income tax, if you don’t believe me you can look for it on the internet.

[hgmichna]

… in Panama you pay income tax on the income generated within the country but every income that comes from outside of it does not pay any income tax, if you don’t believe me you can look for it on the internet.

I wouldn't mind moving to Panama.

By the way, beginning 2017-01-01 this no longer helps people outside Panama who keep wealth in Panama, because Panama is a signatory to the OECD AEoI/CRS regulation, has made the related laws, and all financial institutions that keep money or other investments for their customers will report to each customer's home country's tax authority.

The exception is that you live in a country that has not signed the OECD AEoI contract, because to your country Panama will not report. However, I expect that more countries will be forced to join the Automatic Exchange of Information agreement over the coming years.

[bryant.coleman]

There are still around 100 countries that are not participating. The odd man out is the US, the only very large country not participating, but only because they already have their own reporting system in place: FATCA. But OECD CRS is wider in scope.

Unfortunately most bitcoin exchanges are in jurisdictions that participate in the OECD CRS, so most of them will likely report to your tax authority. Check the document for the definition of Reporting Financial Institution in the Annex, Section VIII, and you can decide for yourself whether there is any chance for a bitcoin exchange to escape this regulation.

Of course the bitcoin exchanges do not warn their customers, because they are afraid of a mass exodus before the end of 2016. Some banks did warn their customers though. An example from a Suiss bank (Saxo) is here.

The situation is not overly pessimistic. As I can see, less than half of the UN members are participating in this. So the Bitcoin exchanges are left with two choices: 1. move the operations to a country which is not participating 2. Comply with the regulations. I am afraid that most of the exchanges are going to prefer the former option.

[Zadicar]

It will surely kill income tax if bitcoin adoption will spread throughout the globe and that's why most government would really not let this thing to happen that's why they will ban bitcoin on their place.people love bitcoin because they have the full control of their money.

[hgmichna]

The situation is not overly pessimistic. As I can see, less than half of the UN members are participating in this. So the Bitcoin exchanges are left with two choices: 1. move the operations to a country which is not participating 2. Comply with the regulations. I am afraid that most of the exchanges are going to prefer the former option.

You mean the latter option?

Have you looked at the country list? Unfortunately most countries that harbor bitcoin exchanges are participating. If you find a bitcoin exchange that is located in a non-participating country, please report it here. There may be a few.

[n0ne]

It will surely kill income tax if bitcoin adoption will spread throughout the globe and that's why most government would really not let this thing to happen that's why they will ban bitcoin on their place.people love bitcoin because they have the full control of their money.

It kills income tax to some extent, though continuous adoption was taking place it haven't got spread similar to local fiat to affect the economy through taxation. Only when a big percentage of people in a country use bitcoin directly the taxation issue arises.