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Cryptocurrencies are assets and not currencies. Therefore, are subject to Capital Gains Tax (CGT), rules Israeli court; in case judgment of Noam Copel: a blockchain Founder and Israel Tax Authority, thus ruling in favor of the latter.
Noam Copel, founder of a blockchain-based transportation protocol Decentralized Autonomous Vehicle (DAV), bought digital currency in 2011 and sold it in 2013 at a profit of 8.27 million Israeli new shekels ($2.29 million) and contended with Israel Tax Authority to make sales profit of digital currencies to be free of tax.
The Israeli court endorsed the central bank’s definition of currency and ruled in favor of the country’s tax authority and declared that all the cryptocurrencies should not be considered currencies but taxable assets. The court also ordered Noam Copel to pay one million dollars ($ 1 million) to tax authority and NIS 30,000($8,304) as the cost of failing to file tax from his profits gained from the sale of the bitcoin back in 2011.
Gidi Bar Zakay CPA, crypto tax specialist and the former deputy head of the Israel Tax Authority giving his remarks on the ruling stated that the judge used the provisions of the Israeli law to rule that bitcoin is not a currency but it could only be determined whether bitcoin is a currency or not after its widespread use.
Published at Fri, 24 May 2019 05:04:42 +0000
