A new Israeli draft proposes exempting Bitcoin from taxation
- Four Israeli legislators recently proposed a new bill to the country's parliament.
- The bill proposes several changes regarding crypto taxation, such as excluding BTC from taxation.
- The legislators argue that such a move at this time could help Israel become a leader in crypto payments.
A new proposal by the Israeli lawmakers might have a massive impact on Bitcoin, as the recent draft proposed to start treating the coin as a currency. If the proposal ends up becoming law, Bitcoin will officially be exempt from tax purposes.
Israeli legislators propose exempting BTC from capital gains tax
A recent report published by Globes revealed that as many as four legislators from the Yisrael Beiteinu party recently presented a new bill called the Income Tax Ordinance, which aims to introduce changes to the taxation of cryptocurrency. The bill was presented to the country’s parliament only a few days ago, September 22nd.
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The legislators in question include MK Oded Forer, Yulia Malinovsky, Yevgeny Soba, and Alex Kushnir. Their bill actually proposed multiple changes to digital currency taxation, although the most interesting one by far is the proposal to exempt cryptos such as Bitcoin from capital gains tax.
The bill claims that the regulatory reality within the country is not adapted to the reality of the field. Cryptocurrencies can help the Israeli tech industry to further develop and flourish, and as such, it should be made available and easy to use without taxation that makes this use overly complicated and intimidating.
Eliminating BTC tax could turn Israel into a crypto payment leader
Right now, Israel still sees Bitcoin as an asset, which means that it is subjected to the capital gains tax of 25%. However, there are some users who found a way to pay a lower tax of 15% by undertaking bonds-related activities or short-term lending.
Furthermore, in 2019, those with income below $22,000 had a further decreased tax rate of only 10% on average.
MK Forer argued that Israel is already quite far ahead regarding technological development, and that it can push that even further, thus becoming a leader in cryptocurrency-based payments. This is certainly something to consider, particularly now, as online and contactless payments are encouraged due to the global pandemic.