Israel Tax Authority (ITA) confirmed that will tax cryptocurrencies like bitcoin
The ITA updated a previous circular, where stated that cryptocurrencies like bitcoin are “assets”, thus are subject to capital gain tax.
The first issue of ITA regarding cryptocurrencies was in January 2017. It was due to to repeated requests to know what’s the government stance on cryptocurrencies taxation. With this circular, individual investors should pay 25% for their gains on cryptocurrency holdings. Additionally, business and exchanges will pay a 17% value-added tax (VAT). Individual investors will not pay VAT as ITA takes cryptocurrencies for investment as an intangible assets. Miners and traders should pay the VAT’s 17%.
This position of the tax authority coincide with the similar approach got by the Israel’s central bank. The Bank of Israel (BOI) deputy governor stated that the bank’s position on cryptocurrencies should go through take them as a financial asset, “with all that entails”.
In conclusion, it seems that Israel economic authorities want to give clarity to different stakeholders at the time of invest on cryptocurrencies like bitcoin.