Substantial increase in the upper limit of tax payment by virtual currency
The Swiss canton of Zug has raised the maximum taxable amount for crypto assets (virtual currencies) Bitcoin (BTC) and Ethereum (ETH) to about 230 million yen (1.5 million Swiss francs). The Block reported.
From 2021, the canton of Zug will start accepting tax payments in Bitcoin and Ethereum. Until now, the upper limit was about 15.3 million yen (100,000 Swiss francs), but it has been raised to 15 times.
Since the introduction of the initiative in 2021, the canton of Zug has received about 150 cryptocurrency tax payments, with a total value of about 300 million yen (about 2 million Swiss francs).
Based on this positive experience, the Zug Finance Authority is calling on businesses and citizens to try out these new cryptocurrency payment methods.
From the second half of 2023, it is expected that a mechanism will be introduced that will allow tax payments to be made in virtual currency simply by scanning the QR code on the payment slip issued by the tax authorities. This will make payment in virtual currency more convenient.
Since 2016, the canton of Zug has made it possible to pay taxes in bitcoin in the city of Zug, the state capital. After that, from February 2021, the entire state will start paying taxes in Bitcoin and Ethereum.
connectionSwiss canton Zug to allow taxes in Bitcoin and Ethereum
Bitcoin Suisse, a major cryptocurrency broker in the country, cooperates with tax payments, and the company converts cryptocurrencies paid by taxpayers into Swiss francs.
The area around the city of Zug is a global center for banking and finance, and the blockchain industry is also thriving, so it is called “Crypto Valley”. Dirk Klee, CEO of Bitcoin Suisse, commented:
The canton of Zug has long been an important hub for the cryptocurrency industry. The increased tax threshold once again demonstrates Zug’s leadership position in the adoption of cryptocurrencies.
Multiple local governments accept virtual currency
In Switzerland, the city of Lugano is also known for its efforts in cryptocurrencies. We are in the process of making Bitcoin, USDT, and Swiss franc-linked stablecoin LVGA available for individuals and businesses to pay taxes, public services, and more.
By the end of 2023, it plans to introduce three types of payments at more than 2,500 stores. McDonald’s and others have already introduced virtual currency payments.
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Chiasso and Zermatt, small towns with less than about 8,000 inhabitants, also accept bitcoin payments. Bitcoin Suisse is also in charge of currency exchange in Zermatt. The virtual currency paid is converted into Swiss francs and transferred to the municipal bank account.
What is a stablecoin
A cryptocurrency whose price is always stable. Stablecoins are a type of cryptocurrency, and unlike BTC, ETH, and XRP, which have volatility, their purpose is to maintain their value ($1) backed by the US dollar. In addition to US dollar-backed stablecoins (USDT/USDC), there are also stablecoins that use algorithms.
Liechtenstein also plans to introduce
Switzerland’s neighbor, the Principality of Liechtenstein, is also envisioning allowing bitcoin to be used to pay for public services.
Received bitcoins will be immediately converted into legal tender Swiss francs and received. No specific timing of implementation was mentioned.
connection: Prime Minister of Liechtenstein reveals plan to introduce bitcoin payment for administrative services