The Portuguese tax office has announced that cryptocurrency transactions will not be taxed.
Taxes on cryptocurrency transactions are one of the hottest topics in this industry. Several countries decided to abolish VAT on such operations. For example, in Singapore, it was argued that using cryptocurrencies as a means of payment for services would not result in a supply of coins.
The US tax office recently sent a letter to cryptocurrency investors regarding the distortion of their income from coin trading. Nevertheless, the guide by the tax office is considered unclear and puts investors in a difficult position.
Portugal abolishes crypto VAT
The Portuguese tax office has confirmed that it will not impose VAT on any cryptocurrency transactions. Besides that, a special document was published describing the state's attitude towards the local cryptocurrency mining industry. It states that the exchange of virtual currencies into fiat ones is tax-free and there is no expectation that this will change.
The tax office referred to the 2015 European Court of Justice ruling. The case of the Swedish Bitcoin.se website and its moderator, David Hedqvist, was considered. Bitcoin is a means of payment, exactly like fiat currency, and should therefore not be subject to taxes such as VAT.