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Polish Tax Man Says Bitcoin Mining Profits Subject to VAT

Avatar newsbtc 6 years ago

Mining bitcoins or other digital currency in Poland? You may be required to pay a value-added tax (VAT).

That’s according to CoinDesk, who says the decision was made by tax official’s in Poland’s third-largest city, Łódź. Said decision was made in response to an inquiry from a bitcoin miner in the country, who was looking to sell his mined bitcoins to three different companies.

Two of the organizations the miner was planning to sell to were based inside the European Union, the other outside.

The miner’s understanding was that he wouldn’t have to pay a VAT on his transactions, prompting him to get clarity from the tax authority:

“According to the applicant […] the sale of bitcoin is not subject to a value-added tax for commodities and services because bitcoin is not a commodity […] and the sale of the cryptocurrency which is mined by the taxpayer does not constitute a service,” the authorities said. “The applicant said that a mined bitcoin is not a commodity […] because it does not have a material form.”

But the tax authority fired back noting that the miner’s understanding was incorrect:

“Under the current law, the applicant’s legal assessment of the said situation is incorrect,” the statement said. “The sale of the mined cryptocurrency […] by the applicant to customers with the use of Internet and websites will constitute an activity which is subject to VAT in the territory of Poland.”

The tax authority added that the imposable tax rate would be 23 percent.

[textmarker color=”C24000″]Source[/textmarker] CoinDesk [textmarker color=”C24000″]Image[/textmarker] Jan Mehlich

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