Today\u2019s ruling at the European Court of Justice (ECJ) means that transactions involving bitcoin \u2013 the digital currency \u2013 will be exempt from value-added tax (VAT).<\/p>\n
First introduced in 2009, bitcoin transactions are, according to the ECJ, \u201cexempt from VAT under the provision concerning transactions relating to currency, bank notes and coins used as legal tender\u201d.<\/p>\n
The news has been welcomed by European bitcoin exchanges, who would have faced major difficulties if a different judgement was passed.<\/p>\n
Senior legal advisors at the ECJ had already indicated that the non-traditional currency, which is created and held electronically, should not be subject to VAT, but Judges in the court do not always agree with their advice.<\/p>\n
A dispute between David Hedqvist, who sells Bitcoin on his website, and the Swedish tax authority, the Skatteverket, was the reason for the legal case being launched.<\/p>\n
However, despite uncertainty around the issue, the judgement at the highest court in the EU has clarified the stance, stating that when virtual bitcoin exchanges were used as a way of issuing a payment it would be exempt from VAT.<\/p>\n
The situation regarding bitcoin status in the US is different to Europe, where a number of criminal cases have categorised the virtual currency alongside money, primarily for money laundering offences.<\/p>\n
While bitcoin now represents a good investment for European savers, the US Commodity Futures Trading Commission (CFTC) last month stated that it was a commodity and also closed down Coinflip, the trading platform.<\/p>\n","protected":false},"excerpt":{"rendered":"
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