Senate inquiry backs digital currency

The Senate Economics References Committee into digital currency has said it is time for bitcoin and other digital currencies to be considered as regular currency for tax purposes, with the findings contrasting with an Australian Taxation Office ruling that such currencies are “intangible assets”, The Australian Financial Review reports.

The Senate inquiry is due to hand down its official report next Monday, with the findings expected to be a major fillip for the local bitcoin sector given transactions would no longer be subject to GST and capital gains tax. However, work is still seen needed before the RBA and ASIC can properly regulate digital currency.

"The amount of revenue in question is negligible. The opportunities for trade, investment, high salaries and world-leading skills are far more important, and I urge the states to work with the Commonwealth to make what amounts to simple change," Senator Sam Dastyari, who heads the Senate economics committee, told the AFR.

"Without a doubt, the main benefit will be the confidence and certainty that removing a GST will provide to our own digital entrepreneurs, and the foreign businesses who want to set up here."