Israel Published Draft ICO Taxation Plan

Israel's authorities proposes to tax ICO with value-added tax
18 January 2018   945

The Israeli government published a draft plan, which described possible ways of taxing the ICOs profits.

The plan was published on Wednesday by the IRS. It proposes to tax the ICO with value-added tax (VAT). The document specifies that, according to the current legislation, goods and services offered to foreign citizens will not be taxed.

According to a report published on the official website of the IRS, cryptocurrencies in this plan are not directly affected.

In addition, the plan details the classifications of blockchain companies with an emphasis on the types of goods and services offered, as well as on what model of profit they use.

It also says that under current legislation, the subject of accounting regulation will be sales of tokens, the profit of which is more than 15 million new Israeli shekels ($ 4.4 million).

The amount of tax may change if the company determines its tax liabilities not during, but at the end of the year. 

In cases where the tax liability is determined on a cash basis, at the end of the year, the buyer or recipient of a service is a resident of Israel or vice versa, it is possible that the tax rate for the transaction will change according to the provisions of the VAT Law.

ICO Draft Taxation Plan

The document notes that investors selling already purchased to ICO tokens will also become subjects of taxation. Groups that trade on behalf of registered companies, especially for tax purposes, will be "classified and registered as financial institutions".

The plan emphasizes that in the future it can be changed. The IRS is awaiting public comment on the provisions submitted.

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Bermuda to Issue First ICO License

The first 'official' ICO that will be held at Bermuda is Uulala
19 October 2018   41

Bermuda’s Minister of National Security, Wayne Caines, said that the Uulala fintech company received the first ICO license in the region. It is reported by the Royal Gazette.

In July, the Secretary of the Treasury of the Overseas Territory of Great Britain, David Bert, introduced new regulations for fintech products and services. The bill classifies initial coin offers (ICO) as “limited business activities”.

The draft law also states that before holding a tokensals, companies must provide information about the proposed digital assets, the financing system, the amount to be raised and various technical aspects. In addition, you must obtain consent from the Minister of Finance of the region.

The CEO of Uulala, Oscar Garcia, reported that the process of obtaining a license took four months. Fintech offers a decentralized peer-to-peer network “to attract cash into the digital economy.” During the ICO, Uulala plans to raise $ 50 million.

We are looking at operating from Bermuda. The Bacardi story resonated with us — a group of Cuban Latinos who went to Bermuda and established their headquarters there. We are looking at doing something similar. Bermuda is known as a financial hub and it is very forward-thinking on blockchain and fintech.

Oscar Garcia

CEO, Uulala

The government of Bermuda began to develop bills for the legalization of the ICO in March. Then David Bert said that Bermuda could be an example for other countries in the field of ICO regulation.