Bitcoin mining revenues and payments in crypto-currencies are exempt from VAT in Portugal. This sets Portugal apart from other European countries in terms of regulation.
The message from Portugal
Currently, the report makes the rounds that Bitcoin payments and trading with crypto currencies are tax-free in Portugal. This is due to the Portuguese magazine Negocios.
The tax authorities had already made it clear that income in crypto-currencies is not taxable. Now it is made clear that both the activity of exchanging crypto-currencies into real currencies and the remuneration in crypto-currencies are exempt from VAT in Portugal.
The magazine’s report is again based on a communication made by the tax authorities in Portugal concerning the Bitcoin tax. It was in response to a request from a Bitcoin mining company. This communication again refers to „payments“ made in Bitcoin that are tax-free. This concerns the income from mining activities. Ultimately, therefore, it appears from the notification that payments made in Bitcoin are exempt from VAT. However, this is not entirely new. Because the tax authorities in Portugal are again referring to a ruling of the European Court of Justice from 2015.
The ruling of the European Court of Justice on Bitcoin VAT
The judgment of the European Court of Justice states:
Exchange of conventional currencies into units of the virtual currency „Bitcoin“ is exempt from VAT.
Furthermore, the exchange of Bitcoin into fiat currencies is a service. The fee for this service is the difference between the purchase and sales price.
Bitcoin tax in Germany
Also in Germany, income from Bitcoin & Co. may be tax-free. However, the one-year holding period must be observed. Whoever hodels crypto-currencies for longer than one year, does not have to pay taxes on the sales proceeds as a private person. If the trades fall below the one-year holding period, taxes are also due under certain circumstances. More about the taxation of private capital gains in Germany can be found here.
Euphoria among analysts is rising – Are the gates to the next exponential price rally open?
Bitcoin was able to break out of a long period of very low volatility at the end of last month and has subsequently fought its way sustainably above the $10,500 mark, a long-term resistance that has now become an important support zone. At times, it even managed to break above the $12,000 mark, which is now considered the next important resistance level.
According to a published market analysis by the US crypto stock exchange Kraken, one of the largest crypto trading places worldwide, Bitcoin had reached a 21-month low for volatility of only 23 percent on July 24.
Looking at the crypto currency’s past, BTC’s 12 historical volatility lows, which ranged from 15 to 30 percent, each rally averaged 140 percent. This was also the case last April 2019, during which the BTC climbed from 3500 to up to 13,000 dollars.
That’s why Kraken predicts in the analysis that Bitcoin will follow the usual pattern again this time, and is considering a rise of 50 to 200 percent in the coming months. The report stresses that Bitcoin’s recent rally resulted in the second strongest July for BTC prices since 2011, and notes that July was usually the third weakest calendar month for Bitcoin. The 14.5 percent increase between July 27 and 31 resulted in a 24 percent increase in the month’s overall performance, positioning the market for continued upward momentum, according to Kraken.
Analysts become bullish
Dan Tapiero, co-founder of DTAP Capital and Gold Bullion International, among others, believes a long-term exponential rally for Bitcoin is likely. In a chart recently shared on Twitter, he predicts that Bitcoin could rise 5 to 10 times over the next 2.5 years in what he believes to be the exponential price trend that has just begun.
- Tapiero has already been talking positively about the asset for several weeks and is not alone with this.
- Raoul Pal, a former executive of Goldman Sachs and founder of the finance portal Real Vision, also sees enormous potential for Bitcoin.
In a recently published series of tweets, he once again drew attention to the potential and called Bitcoin the asset with the greatest potential for the next 2 years.
These are all incredibly bullish long-term chart patterns. The probabilities in the charts indicate that Bitcoin will be by far the world’s best performing asset over the next 24 months.