Back in April, the Cointelegraph reported on Australia’s Tax Office (ATO) gearing up to meet with head figures of the Bitcoin industry, accounting and tax experts to issue a ruling on digital currencies in the country that was expected to be delivered on June 30.
With the deadline here, the ATO now reports that it has delayed the much anticipated ruling until further notice, essentially leaving the fate of the country’s thriving Bitcoin economy “in limbo.”
Many had hoped that some possible tax guidance would be released with the decision before the end of the fiscal year. Apparently, the ATO is now seeking Australia's Solicitor-General Justin Gleeson for further assistance as it attempts to tackle the issue of whether digital currencies are money or property.
An ATO spokesman stated that the department received “numerous” submissions from the public about how to approach digital currencies with regards to regulation and taxation. "To ensure our advice to the community is comprehensive and robust we have sought further advice from external legal counsel," said the spokesman. "We have also received representations from industry bodies seeking to provide us with further information." According to the spokespman, the ATO office delayed its decision to make sure the ruling was in accordance with Australian law.
The Bitcoin Association of Australia responded by saying it was disappointed with the pushback but supported the involvement of General Justin Gleeson in the matter and acknowledged that rushing such an important decision would not be wise.
The association president Jason Williams commented:
"As digital currencies such as Bitcoin are now a permanent part of our financial landscape, it is important for Australian regulators and legislators to foster and nurture growth.
"The ATO's position will deliver one of the first precedents in the Australian legal and regulatory landscape and will be an influential benchmark.
"As such, it is important not to rush decisions."
- Jason Williams, President, Bitcoin Association of Australia
Australia is considered to be one of the most Bitcoin-friendly nations in the world who has its own share of Bitcoin ATMs, merchants, exchanges, and VC funds. Therefore, a delay or any ambivalence from the government on any guidance essentially puts the country’s thriving economy in a regulatory gray area. Amidst the uncertainty, merchants accepting BTC payments must do business without a clear definition of what taxes they may be subject to now or in the future. Moreover, with the fiscal year coming to a close, many could be left with lengthy tax bills as a result of the wait.
Interestingly enough, Freedom of Information (FOI) documents revealed that the ATO has been taking Bitcoin seriously and keeping a close eye on cryptocurrency news and developments both at home and abroad because it was concerned that people may be using Bitcoin or other digital currencies for tax evasion.
Now, hopefully with the help of the country’s second law officer, General Justin Gleeson, Australia will be able to issue some guidance on Bitcoin in accordance with national laws in the near future and clear up the smoke so the Bitcoin space can further develop in the country.