Bitcoin now 'unit of account' in Germany • Hacker News Board

Re: Bitcoin now 'unit of account' in Germany

#21

Post by justincormack » Tue, Aug 20, 2013, 4:36 PM UTC

gioele wrote: post #10

Bitcoin fulfils easily the definition of "electronic money" found in the European directive 2009/110/EC, art. 2 def. 1: > 2. "electronic money" means electronically, including magnetically, stored monetary value as represented by a claim on the issuer which is issued on receipt of funds for the purpose of making payment transactions as defined in point 5 of Article 4 of Directive 2007/64/EC, and which is accepted by…

I don't see that it represents a "claim on the issuer" though. Although you could claim it as issued by the entropy of the universe in a double entry system...

Re: Bitcoin now 'unit of account' in Germany

#22

Post by justincormack » Tue, Aug 20, 2013, 4:45 PM UTC

effn wrote: post #5

perlgeek wrote: post #3

Earlier quoted context omitted.

There are extra taxes for trading with currencies in Germany (and other countries, it seems; google "forex tax"). So without it being recognized as a currency, you still have to pay VAT, but not forex tax.

VAT is never charged on assets (which Bitcoin is), only goods and services.

That's not really true. VAT is no longer charged on gold coins for investment purposes since the EU made the UK change the law but it is not that clearcut.

Re: Bitcoin now 'unit of account' in Germany

#23

Post by alexro » Tue, Aug 20, 2013, 5:04 PM UTC

It sounds more like a psychological achievement than legal. German government has no means to control BTC, that means BTC is still in the wild.

This is good for the moment, but also begs a question: when the real regulation comes into play how it will be played? But for now - relax and enjoy!

Re: Bitcoin now 'unit of account' in Germany

#24

Post by Osiris » Tue, Aug 20, 2013, 5:17 PM UTC

walden42 wrote: post #19

cs702 wrote: post #4

Germany is acting very logically in response to Bitcoin. Their thinking: "if a growing number of people are using it as a store of value or medium of exchange, or as a vehicle for financial speculation, let's regulate and tax its use." This bodes well for Bitcoin, because other countries are likely to follow Germany's example.

> However, companies wanting to use it for commercial transactions would need permission from the Federal Financial Supervision Authority. That's not a good thing for bitcoin, though, or for the free market in general. One of the main ideas behind bitcoin is its ease of use compared to exisiting methods. The more regulations and limitations imposed on it, the more it becomes like everything else, in terms of ease of…

With the exception that it's supply and exchange rate cannot be (easily) manipulated by governments, which removes a significant power that they currently exercise over fiat currencies.

Re: Bitcoin now 'unit of account' in Germany

#25

Post by betterunix » Tue, Aug 20, 2013, 5:18 PM UTC

alexro wrote: post #23

It sounds more like a psychological achievement than legal. German government has no means to control BTC, that means BTC is still in the wild. This is good for the moment, but also begs a question: when the real regulation comes into play how it will be played? But for now - relax and enjoy!

No means to control Bitcoin? As long as the German government is able to enforce its tax code it can control Bitcoin. Governments have been collecting taxes on things that are much harder to track than Bitcoin for much longer than Bitcoin has existed.

Re: Bitcoin now 'unit of account' in Germany

#26

Post by betterunix » Tue, Aug 20, 2013, 5:19 PM UTC

derefr wrote: post #16

I wonder how Germany expects to be able to tax this? It's very hard to audit someone's collection of BTC wallets. Will this only be to require companies to collect VAT for BTC transactions, or will it also include, say, income tax when you're being paid in BTC?

It is harder to audit paper money, but they are able to tax that...

Re: Bitcoin now 'unit of account' in Germany

#27

Post by alexro » Tue, Aug 20, 2013, 5:30 PM UTC

betterunix wrote: post #25

alexro wrote: post #23

It sounds more like a psychological achievement than legal. German government has no means to control BTC, that means BTC is still in the wild. This is good for the moment, but also begs a question: when the real regulation comes into play how it will be played? But for now - relax and enjoy!

No means to control Bitcoin? As long as the German government is able to enforce its tax code it can control Bitcoin. Governments have been collecting taxes on things that are much harder to track than Bitcoin for much longer than Bitcoin has existed.

No way for now, still not clear how they gonna assign monetary value to BTC, what exchange rate they will use?

Re: Bitcoin now 'unit of account' in Germany

#28

Post by betterunix » Tue, Aug 20, 2013, 5:33 PM UTC

alexro wrote: post #27

betterunix wrote: post #25

Earlier quoted context omitted.

No means to control Bitcoin? As long as the German government is able to enforce its tax code it can control Bitcoin. Governments have been collecting taxes on things that are much harder to track than Bitcoin for much longer than Bitcoin has existed.

No way for now, still not clear how they gonna assign monetary value to BTC, what exchange rate they will use?

What exchange rate do they use for forex transactions?

Re: Bitcoin now 'unit of account' in Germany

#29

Post by VMG » Tue, Aug 20, 2013, 5:40 PM UTC

walden42 wrote: post #19

cs702 wrote: post #4

Germany is acting very logically in response to Bitcoin. Their thinking: "if a growing number of people are using it as a store of value or medium of exchange, or as a vehicle for financial speculation, let's regulate and tax its use." This bodes well for Bitcoin, because other countries are likely to follow Germany's example.

> However, companies wanting to use it for commercial transactions would need permission from the Federal Financial Supervision Authority. That's not a good thing for bitcoin, though, or for the free market in general. One of the main ideas behind bitcoin is its ease of use compared to exisiting methods. The more regulations and limitations imposed on it, the more it becomes like everything else, in terms of ease of…

It would be a bad thing if Bitcoin could be controlled that way. Luckily, the government cannot influence bitcoin transactions.

Re: Bitcoin now 'unit of account' in Germany

#30

Post by PeterisP » Tue, Aug 20, 2013, 6:46 PM UTC

VMG wrote: post #29

walden42 wrote: post #19

Earlier quoted context omitted.

> However, companies wanting to use it for commercial transactions would need permission from the Federal Financial Supervision Authority. That's not a good thing for bitcoin, though, or for the free market in general. One of the main ideas behind bitcoin is its ease of use compared to exisiting methods. The more regulations and limitations imposed on it, the more it becomes like everything else, in terms of ease of…

It would be a bad thing if Bitcoin could be controlled that way. Luckily, the government cannot influence bitcoin transactions.

There is no need to influence transactions technically, it's just clarifying existing law - when doing/receiving Bitcoin transactions, you follow the same rules [or else].

No matter if your income is in Euro, Yen, gold, goats, casino chips, redeemable in-game credits, gems, Bitcoin or anything that may ever be invented - that income is taxable.

If you are offering to hold deposits of value for public, or value transfers to third parties - no matter if that is in Euro, Yen, gold, goats, casino chips, redeemable in-game credits, gems, Bitcoin - you need to follow the financial service regulations.

The only way to avoid that is if (while) your "new money" is useless as money, i.e., you can't buy stuff with it.