In March 2018, the Australian Taxation Office (ATO) asked the community for feedback on "Substantiating cryptocurrency taxation events".
We believe it is our civic duty as well as in the interest of the general public that the cryptocurrency community engages actively in this process. This joint submission has been prepared via a collaborative effort between several individuals, residing in several states across Australia. It represents our beliefs and opinions about this topic. However, we hope that readers around Australia will look at what we've presented, and throw their weight behind it by signing this online petition.
The full submission can be viewed on Slideshare by clicking here, but here's a quick summary:
In this document, we convey that if tax obligations in the cryptocurrency space are simpler, fairer, and easier to understand, then:
- The likelihood of individuals to correctly comply with their tax obligations is higher.
- The temptation for individuals evade paying taxes is lower.
- The burden on the ATO, and in-turn the tax payer, will be minimised as less time and fewer resources will need to be committed to auditing tax returns and chasing evaders.
- The fear of use of cryptocurrency be reduced and adoption of the technology will increase.
- It will provide regulatory certainty that will incentivise investment and growth in this developing industry.
The document is in direct response to questions asked by the ATO, and discusses issues such as:
- Record Keeping, which in accordance with current interpretation of the regulations will place a huge burden on individuals, often for very little tax liability.
- Exchanging cryptocurrency for other cryptocurrencies and for fiat currency (i.e. Australian Dollars) and difference between the current (AUD driven) taxation system and exchanges that take place within the cryptocurrency space.
We are calling on the ATO to seriously consider this submission when developing further public advice and guidance, and influence future regulations to achieve the following:
- The sensible application of tax regulations to the cryptocurrency space to help create a fair system in which law-abiding Australians are supported, whilst undermining the business case for those attempting to cheat the system;
- Reducing the cost of complying with, and administrating tax obligations;
- Simplifying record-keeping obligations and creating a closer coupling between the Australian tax system and the cryptocurrency space;
- Recognising the exchange of one cryptocurrency for another cryptocurrency as a “like kind” exchange and only the exchange of Australian Dollars for a cryptocurrency and vice versa would materially affect an individual’s current tax liability;
- Acceptance of cryptocurrency payments towards settlement of tax obligations, and disregarding liquidation of assets made specifically with the intent of settling tax obligations as a taxable event.
View the full submission here and sign this petition to demonstrate that you, as an Australian, support these objectives.