Bitcoins have been legalized in the EU today

[lsat 23]

The exchange of traditional currencies for units of the ‘bitcoin’ virtual currency is exempt from VAT

 

:clap:

[OmniNegro 155]

Thanks for this. I was unaware that anyone had ever managed to make them "illegal".

[zhang888 1066]

Does this mean that from now on, every European business that accepts bitcoins, will actually have to sell you all goods without VAT,

no matter on the country of origin?

 

This is a good thing then.

[OmniNegro 155]

No. This means that you will not be charged VAT for exchanging currencies for Bitcoins. Everything else is still taxed.

 

For instance if you use the Euro to exchange for Bitcoins, you will not be charged VAT in Sweden anymore. (And only in Sweden unless I am reading it wrong.)

[zhang888 1066]

I thought this is already the case...Since it will not make sense otherwise.

Imagine that you buy Bitcoins with cash and pay ~20% VAT.

 

So now 100 Euros become 80 Euros in BTC. Then you buy something worth 80 Euros while paying in BTC,

and you are charged VAT (20%) again? So this is like double VAT payment and should not happen.

Just like when I used to come to Europe with USD cash, I never rememer I had to pay VAT for the exchange.

But later when I buy something I pay VAT in any place where the payment is made in Euros.

And I'm not sure the exchange company pays it as well, since it will make them unable to hold such losses...

 

So Bitcoins should not be treated just as another foreign currency. I'm really far from tax laws, will be happy

if someone with more knowledge about the EU law in particular can add some notes.