Australia to recognise Bitcoin as money by early July
By 1 July, Bitcoin will be treated as money, and will be exempt from goods and services tax. This means that Bitcoin investors and traders won’t be taxed for using Bitcoin through regulated exchanges and trading platforms.
Australia’s Bitcoin exchange has suffered from competition from bitcoin market leaders South Korea and Japan. These countries occupy over half of the Bitcoin market.
The double taxation of Bitcoin trading by the Australian government is one reasons why start-ups, exchanges and businesses dealing with Bitcoin and other digital currencies in Australia.
However, double taxation and goods and services taxation on Bitcoin will be exempted.
In its 2017 to 2018 budget for “Backing innovation and FinTech,” the Australian government wrote:
“The Government will make it easier for new innovative digital currency businesses to operate in Australia. From 1 July 2017, purchases of digital currency will no longer be subject to the GST, allowing digital currencies to be treated just like money for GST purposes. Currently, consumers who use digital currencies can effectively bear GST twice: once on the purchase of the digital currency and once again on its use in exchange for other goods and services subject to the GST.”