For months, Australia’s government has promised to end the double taxation of Bitcoin and other digital currencies. The nation’s parliament moved to fulfill that promise on Thursday, as it passed new laws designed to ensure that digital currency users will no longer be subject to Australia’s goods and services tax (GST) when they buy cryptocurrency.
The old rules governing taxation of cryptocurrency required users to pay taxes twice: once when they purchased their Bitcoin or other digital currencies, and then again whenever they exchanged that currency for goods subject to the Australian GST. Digital currency enthusiasts had been understandably resistant to that double taxation.
The Turnbull Government agreed, and introduced legislation in September to eliminate the GST taxation on all digital currencies. The stated goal at the time was to end the unfair taxation and “make it easier for new innovative digital currency businesses to operate in Australia, as the Government takes action to boost jobs and wages.”
Media outlets have offered different assessments of when the legislation will go into effect. Several cryptocurrency news sites have reported that the new law will be retroactively applied from July 1, 2017 – which was the plan announced by the government in last month’s statement. However, the Australian reports that the tax change will go into effect on July 1, 2018.