Singapore Declares Bitcoin Taxable

The Inland Revenue Authority of Singapore (IRAS) has stated in an email that gains from transactions in Bitcoin will be taxed as Income Tax, for companies and individuals based in Singapore.


It was also mentioned that if the Bitcoins were held as a long-term investment, then capital gain profits will not be taxed. Also, all transactions where Bitcoins are used as payment for physical money, services, and goods will be taxed if both parties involved are in Singapore.

While this does not mean much for the rest of the world, it impacts Singaporean companies greatly, taking off profit from their goods and services. It also means more regulations on Bitcoin transactions, as the Inland Revenue Authority of Singapore would clamp down and track Bitcoin to fiat transaction, to tax them with Goods and Services tax (GST). With only a few countries around regulating the usage of Bitcoin in their respective countries, such as China preventing companies from transacting Bitcoin payments, would Bitcoin survive the tough regulations to come? Bitcoins may be anonymous while it still is in Bitcoin form, but when you exchange them into fiat and withdraw it into your bank account, that amount draws a huge red flag. Governments would be monitoring transactions more closely, and tax everything that does not seem right.

But is there a way to prevent this? There is one obvious solution: keep everything in Bitcoin. By keeping your savings and fiat into Bitcoin as a long term investment, you not only benefit from added anonymously, security, and a rising value and devaluing of fiat, but you also are not taxed on any gains that you make. Maybe one day employees will get their pay in the form of Bitcoin, preventing income tax for some as governments cannot easily track Bitcoin payments to the original senders and receivers. However, countries cannot run without tax money to pay for infrastructure, education, health care, and police, among others. This will save Bitcoiners bottom line from those tedious but necessary taxes, but would effect would it have on our countries and governments? More likely than not, regulations will toughen over the next few years, as young and defiant Bitcoin goes against the forces of a devaluing fiat world. Governments may in the future find a way to identify and tax eligible transaction in Bitcoin. But until then, we can all sleep a little better knowing Bitcoin is truly anonymous, for now.

source: http://cryptosource.org/singapore-declares-bitcoin-taxable/

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