A new draft introducing amendments regarding the taxation of crypto incomes has been published in Poland. The bill differentiates between decentralized cryptocurrencies and centralized virtual money, and clarifies the tax regime applicable to crypto trading and mining.
Also read: Eastern Europe: Regulation Postponed, Tax Abandoned, Banks Enlightened
Draft Distinguishes Between Cryptos and Centralized Coins
The executive power in Poland has announced a new draft amending the country’s tax laws to incorporate the taxation of incomes and profits related to cryptocurrencies. The text has been published on the website of the Government Legislation Center. The document has been offered for consultations and its adoption by the Council of Ministers is planned for the third quarter of this year.
The stated purpose of the bill is to simplify and clarify the procedures for reporting and paying taxes on revenues from crypto-related activities. The new proposals come after an earlier decision to tax all digital money transactions, regardless of profit or loss, sparked protests from the Polish crypto community. The Finance Ministry admitted “the irrational effect” of the Civil Law Transactions Tax (PCC) in the case with cryptocurrencies and abandoned the idea to impose it until a comprehensive solution is found.
In accordance with the Act on Counteracting Money Laundering and Terrorism Financing, the draft law defines virtual currency as a “digital representation of value.” The authors also divide virtual currencies into two groups – cryptocurrency and centralized virtual currency, the Polish outlet Kryptowaluty reports. Even more importantly, the legal text details that virtual currencies can serve as a medium of exchange and be accepted as means of payment, they can be stored and transferred electronically and used in e-commerce.
Crypto-to-Crypto Transactions Will Not Be Taxed
The bill addresses the taxation of both natural persons and corporate entities. The main proposal is to declare revenues from virtual currency transactions as part of the taxable income of individuals and businesses. These include proceeds from the sale of cryptos on exchanges, other trading platforms and in over the counter deals on the free market. Incomes from the sale of goods, services and property for cryptocurrency will also be treated as revenues from capital gains. The exchange between cryptocurrencies, however, will not be taxed.
Cryptocurrency miners are also expected to pay taxes on their profits but the tax base will be determined depending on the nature of their economic activity. When miners work for themselves, they will pay tax on the gains from the sale of the mined cryptocurrency. If they mine on behalf of other entities or individuals, the value of their remuneration will be taxed. However, if they chose to convert the cryptocurrency to fiat before they pay their clients, the whole amount will be considered as revenue and tax will be due on the total.
All these obligations should be reported on the annual tax returns and settled once a year, according to the published draft. Taxpayers dealing in cryptocurrency will not be required to pay taxes in advance. Poland currently applies a progressive income tax scale with two brackets – 18 percent for annual incomes of up to 85,528 zloty (~€20,000), and 32% for those above this limit. Previous reports have suggested that changes to the tax regime will be made next year.
What is your opinion on the law amendments regarding the taxation of crypto incomes in Poland? Share your thoughts on the subject in the comments section below.
Images courtesy of Shutterstock.
Express yourself freely at Bitcoin.com’s user forums. We don’t censor on political grounds. Check forum.Bitcoin.com.
The post New Bill Clarifies Crypto Taxation in Poland appeared first on Bitcoin News.
via Lubomir Tassev
0 comments:
Post a Comment