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No Blockchain Amendments for Tax Law are Necessary
June 23, 2020 | Tax News
No Blockchain Amendments for Tax Law are Necessary
On the session of Federal Council on 19 June 2020, the report regarding the amendments connected with blockchain to the tax law was taken into consideration. It was decided that no special amendments are necessary. This conclusion complements Switzerland's broader financial stability efforts, such as the recent Switzerland UK cooperation on cross-border financial services.
It is worth to admit, that the current legislation is still a powerful instrument in regulation of income, profit, wealth and capital gains taxes. Similarly, tax oversight has been strengthened through international compliance mechanisms like the automatic exchange of information, ensuring greater transparency in fiscal matters.
Due to the fact that the currently VAT law guarantees the arrangements of distributed ledger technology and blockchain, the additional legislative measures are not required.
During the session the question about the withholding tax connection on income from share and participation tokens was also discussed. The evolution of token-based finance also intersects with developments such as the Libra payment licence, which raised regulatory questions about classification and supervision.
Because the situation with the type and scope of the usage of the DLT Trading platform in the future is still indeterminate, the amendments to the transfer stamp tax were also not made. This cautious approach echoes broader supervisory trends, including the response to misconduct seen in cases like the FINMA sanctions Julius Baer.
On 7 December 2018, the Federal Council began to analyse the situation to understand if the amendments to tax law are needed. As a result, the Federal Department of Finance on the instructions of the Federal Council has prepared the report on the necessity of tax law adaptation to the DLT and blockchain progress. Public engagement with emerging topics such as blockchain has also been encouraged through educational channels like the Swiss bankers podcast, helping to raise awareness on regulatory matters.
It is worth to admit, that the current legislation is still a powerful instrument in regulation of income, profit, wealth and capital gains taxes. Similarly, tax oversight has been strengthened through international compliance mechanisms like the automatic exchange of information, ensuring greater transparency in fiscal matters.
Due to the fact that the currently VAT law guarantees the arrangements of distributed ledger technology and blockchain, the additional legislative measures are not required.
During the session the question about the withholding tax connection on income from share and participation tokens was also discussed. The evolution of token-based finance also intersects with developments such as the Libra payment licence, which raised regulatory questions about classification and supervision.
Because the situation with the type and scope of the usage of the DLT Trading platform in the future is still indeterminate, the amendments to the transfer stamp tax were also not made. This cautious approach echoes broader supervisory trends, including the response to misconduct seen in cases like the FINMA sanctions Julius Baer.
On 7 December 2018, the Federal Council began to analyse the situation to understand if the amendments to tax law are needed. As a result, the Federal Department of Finance on the instructions of the Federal Council has prepared the report on the necessity of tax law adaptation to the DLT and blockchain progress. Public engagement with emerging topics such as blockchain has also been encouraged through educational channels like the Swiss bankers podcast, helping to raise awareness on regulatory matters.
Source: https://www.admin.ch/gov/en/start/documentation/me...
Legal disclaimer. This article does not constitute legal advice and does not establish an attorney-client relationship. The article should be used for informational purposes only.
Legal disclaimer. This article does not constitute legal advice and does not establish an attorney-client relationship. The article should be used for informational purposes only.