Singapore Government Proposes Exempt of Value-added Tax on Cryptocurrencies
The government of Singapore is planning to end value-added tax (VAT) on cryptocurrencies that function or are intended to function as a medium of exchange.
The Inland Revenue Authority of Singapore (IRAS) published draft VAT guidelines on Friday, stating that the supply of “digital payment tokens” in exchange for fiat currency or other digital payment tokens will be exempt from VAT. Therefore, the supply of such tokens, being an exempt supply, “will not contribute to your annual taxable turnover for the determination of your liability for VAT registration.”
If the proposal passes legislation, it will become effective from January 1, 2020. The IRAS has defined digital payment tokens as having the following characteristics:
“(a) it is expressed as a unit; (b) it is fungible; (c) it is not denominated in any currency, and is not pegged by its issuer to any currency; and (d) it is, or is intended to be, a medium of exchange accepted by the public, without any substantial restrictions on its uses as consideration.”
Bitcoin (BTC), ether (ETH), litecoin (LTC), dash (DASH), monero (XMR), Zcash (ZEC) and XRP are examples of digital payment tokens, the IRAS stated.
To point out, stablecoins do not qualify as digital payment tokens as per the definition by the authority, “A digital token pegged to US dollars will not qualify as a digital payment token but may instead fall under the list of financial services”. (Positive)
European Central Bank Exec Calls for Fast Regulatory Action Regarding Libra
European Central Bank executive board member Benoit Coeure said that financial regulators must act fast to prepare for Facebook’s Libra stablecoin.
Coeure argued on Sunday in Aix-en-Provence in southern France that allowing for the development of new financial services and asset classes in a regulatory void is irresponsible.
According to Coeure, the development of digital assets has exposed gaps in current financial regulations, and underlines banks’ slow rate of adoption of new technologies:
The ECB has generally approached crypto assets with caution, with one bank official predicting that crypto will end up as a “complete load of nonsense” in January. The bank has also discussed the possible benefits and drawbacks of central bank digital currencies.
Coeure’s reaction is in line with the predictions of Jeremy Allaire, co-founder and CEO of payments company Circle.
Last week, the United States House of Representatives Committee on Financial Services requested that Facebook and its partners to stop development on the Libra stablecoin. The request came on the heels of a letter from various advocacy groups, urging Congress to implement a moratorium. (Neutral)
Latin American Social Network Taringa! Launches Stablecoin Rewards
Latin American social networking giant Taringa! has partnered with MakerDAO and e-wallet provider Airtm to launch a stablecoin-powered points system for its 27 million strong user base.
The pilot program, dubbed “Taringa! Pioneers,” will reportedly reward users with points for creating popular platform content, which can then be monetized by being converted into MakerDAO’s Ethereum blockchain-based stablecoin DAI.
Taringa!’s news release places a strong accent on the program’s potential to offer users a secure and stable store of value, as well as financial independence from governments.
The social network notably has significant traction across a region in which multiple countries have been experiencing hyperinflation — such as Argentina and Venezuela.
As previously reported, Taringa! Is no stranger to the crypto sphere, partnering with wallet provider Xapo to launch a bitcoin-based revenue distribution system for users as early as 2015. (Positive)