Tax Authority in Israel wants to Treat Bitcoin as a property!!!

[Idrisu]

Undermined bitcoin's usefulness as currencies will undermined its value too. Bitcoin is not even a digital silvers, oil and gold but currencies. http://www.coindesk.com/israel-may-gearing-tax-bitcoin-kind-property/

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[olubams]

Undermined bitcoin's usefulness as currencies will undermined its value too. Bitcoin is not even a digital silvers, oil and gold but currencies.

I will appreciate a link to your source so as to understand the underlying facts of the decision as well as the reasons as well. Then I will know whether to criticise such move or commend it. But I will still say kudos to them for not going the way of Columbia by banning it.

[darkangel11]

Undermined bitcoin's usefulness as currencies will undermined its value too. Bitcoin is not even a digital silvers, oil and gold but currencies.

That's good news. At least they recognize it as something valuable. This will be the beginning of laws and regulations and will influence the recognition of bitcoin. In other words it will spread the word about it.
Maybe some wealthy jewish businessmen decide it's worth the time to learn more about this new digital "property."  Of course a link to the source would be nice.

[HabBear]

Good news indeed. And not news that should cause alarm. If it's worth having governments are going to find a way to tax it. Fortunately it's difficult to prove that one has it. This isn't true with organizations like Coinbase and Circle but no one has to use "a bank" to own, transact, and benefit from bitcoin.

[davis196]

Undermined bitcoin's usefulness as currencies will undermined its value too. Bitcoin is not even a digital silvers, oil and gold but currencies. http://www.coindesk.com/israel-may-gearing-tax-bitcoin-kind-property/

I`m glad that the Israeli tax authorities don`t want to ban bitcoin.

We need more people in Israel to use bitcoin everyday.This is the strongest economy in the middle east.

[TastyChillySauce00]

Well, it's indeed a good news, and I hope that thing goes properly like what happened in U.S.A because they're also treating bitcoin as a property for the answers to the Frequently Asked Question (FAQ) given by their citizen according to this link: https://www.irs.gov/uac/newsroom/irs-virtual-currency-guidance

[sir.humus]

Well, it's indeed a good news, and I hope that thing goes properly like what happened in U.S.A because they're also treating bitcoin as a property for the answers to the Frequently Asked Question (FAQ) given by their citizen according to this link: https://www.irs.gov/uac/newsroom/irs-virtual-currency-guidance

For now it's just a first draft, but it is indeed folowing USA in that matter.

But I still don't get it. How will they enforce this?
All transactions are anonymously, and without declaring it myself no one will know my revenues from bitcoin selling.
The only solution for the tax authotity is to refer it as a valid coin.
When poeple will change their money in official banks the ITA will be able to monitor it.

[Pursuer]

Well, it's indeed a good news, and I hope that thing goes properly like what happened in U.S.A because they're also treating bitcoin as a property for the answers to the Frequently Asked Question (FAQ) given by their citizen according to this link: https://www.irs.gov/uac/newsroom/irs-virtual-currency-guidance

For now it's just a first draft, but it is indeed folowing USA in that matter.

But I still don't get it. How will they enforce this?
All transactions are anonymously, and without declaring it myself no one will know my revenues from bitcoin selling.
The only solution for the tax authotity is to refer it as a valid coin.
When poeple will change their money in official banks the ITA will be able to monitor it.

when people want to buy bitcoin you don't usually go to a dark alley wearing a trench coat and buy bitcoin with unmarked cash bills
instead they go on an exchange website, register, give all their information and documents, link their bank and then buy bitcoin. there is no need to monitor anything. they are reporting it themselves.
and besides this is going to be like investing in many other things, you don't hear people bitch about paying taxes when they invest in gold or trade stocks so why is it different with bitcoin?

[deisik]

Well, it's indeed a good news, and I hope that thing goes properly like what happened in U.S.A because they're also treating bitcoin as a property for the answers to the Frequently Asked Question (FAQ) given by their citizen according to this link: https://www.irs.gov/uac/newsroom/irs-virtual-currency-guidance

For now it's just a first draft, but it is indeed folowing USA in that matter.

But I still don't get it. How will they enforce this?
All transactions are anonymously, and without declaring it myself no one will know my revenues from bitcoin selling

When you sell your bitcoins you convert them to fiat, right?

And what do you want to do next? I guess it is like withdrawing the proceeds to a bank account. But can you open a bank account without providing full details about your identity? Hardly so. In this way, if you receive fiat transaction from some source, you may well expect to be asked what activity does this money come from, yet more so if the sum received is big enough and doesn't quite add up to your official income which you declared in your income tax return

[Xester]

Israel is making a right move when they threat bitcoin as a  property since bitcoin is both a  property and a currency. But given the fact that bitcoin is purchased using fiat currency then the proper way to tax it is to consider it as a property. To tax bitcoin as a currency is hard to to since transactions are done secretly but to tax it like a property is more feasible.

[AT101ET]

I would actually say that this is relatively good news seeing as it's becoming recongnised as an actual asset. Bitcoin has been rather big in Israel so it's no surprise that the government have made a move to try and tax it in whatever way they can.
If anyone is looking to make some money than perhaps it may be a good time to start stockpiling BTC (pre VAT) as long as the price doesn't change too drastically.

[pitham1]

Undermined bitcoin's usefulness as currencies will undermined its value too. Bitcoin is not even a digital silvers, oil and gold but currencies. http://www.coindesk.com/israel-may-gearing-tax-bitcoin-kind-property/

It doesn't matter what the classification is. It is only for tax purposes. After all, a lot of people consider bitcoin as digital gold. That doesnt take away Bitcoin's currency attributes.

[noel2123]

Bitcoin will be legal for other countries if local government treated bitcoin as virtual money. Bitcoin can be legal, if bitcoin will have more securities. For me, bitcoin is not that safe at all, what about the hackers, we cannot say that bitcoin is that safe enough for us. So local government should aim for this

[sportis]

Well, it's indeed a good news, and I hope that thing goes properly like what happened in U.S.A because they're also treating bitcoin as a property for the answers to the Frequently Asked Question (FAQ) given by their citizen according to this link: https://www.irs.gov/uac/newsroom/irs-virtual-currency-guidance

I really can't understand why you think that these news are good news. For whom except Israeli government? For people who have bitcoins why? Firstly Bitcoin is a peer to peer payment system, right? If I hold bitcoins and use it only as commodity, gold or anything else does not matter, then why to have bitcoins? Why the government of Israel does not recognize bitcoin as payment system? If Israel like as and other countries, UK, China, Russia, try to create their own digital currency what will be the bitcoin's value if is not considered as money?

[PolyPanto]

Dear @Idrisu, thank you for the article, this news gives 2 different feelings, from one side it will be legal and it is good and on other side government will develop more tools how to track it and  citizens will have to pay more taxes and property taxes are not low at all ...Also, sorry for pointing but you made a mistake in the title of the topic, you missed letter R in Israel.

[countryfree]

Undermined bitcoin's usefulness as currencies will undermined its value too. Bitcoin is not even a digital silvers, oil and gold but currencies. http://www.coindesk.com/israel-may-gearing-tax-bitcoin-kind-property/

That's only the first step. Next one is to make a national registry of all wallet holders in the country, and the last step is well known to all property owners: it's called tax.

[Dmitry.Vastov]

Seriously, i dont really care how they will treat bitcoin. As long as they are into bitcoin and they are continuing adaption of it. Im okay with that. It doesnt matter to me how you treat it. This just for taxation purposes. Their problem is how they can impose tax to it?

[NUFCrichard]

Good news or bad news, it is stupid!  You can argue if you like that Bitcoin is a currency, or if it is money, or if it is an asset or a commodity.
I can tell you one thing for sure though, it isn't property!

It sounds like they just wanted to find some bracket to put it into, and they found one where they could heavily tax it, so it is now property in Israel.

At least they are taking it seriously I guess, but they could and should be embracing it, instead of stupidly naming it something it isn't!

[Amph]

Well, it's indeed a good news, and I hope that thing goes properly like what happened in U.S.A because they're also treating bitcoin as a property for the answers to the Frequently Asked Question (FAQ) given by their citizen according to this link: https://www.irs.gov/uac/newsroom/irs-virtual-currency-guidance

For now it's just a first draft, but it is indeed folowing USA in that matter.

But I still don't get it. How will they enforce this?
All transactions are anonymously, and without declaring it myself no one will know my revenues from bitcoin selling

When you sell your bitcoins you convert them to fiat, right?

And what do you want to do next? I guess it is like withdrawing the proceeds to a bank account. But can you open a bank account without providing full details about your identity? Hardly so. In this way, if you receive fiat transaction from some source, you may well expect to be asked what activity does this money come from, yet more so if the sum received is big enough and doesn't quite add up to your official income which you declared in your income tax return

there are some anonymous card that are offered from some "shady" website" but some of those i think are legit, just a little expensive

by using this you might in theory evade as they don't revale anything about your identity, but people tend to forget that from the moment you do a purchase online you are traceable...

[deisik]

Good news or bad news, it is stupid!  You can argue if you like that Bitcoin is a currency, or if it is money, or if it is an asset or a commodity.
I can tell you one thing for sure though, it isn't property!

It seems that you misunderstand what is meant here

Most likely, by property they don't mean, for example, real estate or any tangible assets, but rather a property right, or right to property (ownership) in the sense that everyone has exclusive rights to possess, use and dispose of what belongs to him as well as no one can take his belongings from him without his prior consent. In this manner, money can also be an object of the right to property since obviously it is always in someone's ownership and possession