Switzerland’s Zug to Take Cryptocurrency for Tax Payments from 2021

  • Zug, the Swiss ‘Crypto Valley’ Becomes Latest Region to Accept Bitcoin and Ethereum as Tax Payments
  • The Service Commences in 2021
  • Zug’s endeavour being a Blockchain based transaction, proof of payment and account settlements can be expected to speed up, and become more transparent than before.

Zug canton in Switzerland, which has billed itself as a hub for state of the art finance and technology, has announced plans to accept cryptocurrencies Bitcoin and Ether for tax payments starting next year. With this, the crypto-world certainly takes a leap in the direction to integrate cryptocurrencies with the mainstream financial system.

With this, Switzerland’s Zug canton joins its eponymous main city and several Swiss towns in an agreement to accept tax payments in the form of cryptocurrency. Zug is thought to be the first region in the rich Alpine country to make the decision.

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Zug, which is a “Crypto Valley’ of sorts, said it would accept taxes from organisations as well as individuals of up to 100,000 Swiss francs, which is approximately equivalent to $110,000.  All payments can be done either in Bitcoin or Ether. To use this service, all taxpayers need to do is request a unique QR code from the Zug Department of Finance to make the requisite payment. A pilot program to test successful execution of the same is expected to be launched shortly.

Despite being known as crypto valley, Zug would not necessarily have the technological infrastructure to build a solution system for collecting cryptocurrencies as tax payments.  With a view to build a system supporting the same, a partnership was struck with the established broker, Bitcoin Suisse.

As per cantonal finance director Heinz Taennler, no risks will be taken with the new payment method, as they always receive the amount in Swiss francs, even when paying in Bitcoin or Ether

Recently, the news of Basler Kantonalbank (BKB), Switzerland’s 8th largest bank entering into the crypto space through its subsidiary, Bank Cler came in as a positive news for all those who are rooting for crypto-banking as the future.

This is not the first time authorities are exploring the option of accepting cryptocurrencies as a form of tax payment. For instance, an ex treasurer in the US state of Ohio launched OhioCrypto.com in 2018 for business tax payments. However, the state’s attorney general ruled last year that the program was illegal, leading to the project’s doubtful future.

However, Zug’s endeavour being a Blockchain based transaction, proof of payment and account settlements can be expected to speed up, and become more transparent than before.

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Piyasi Mitrahttp://www.thecoinrepublic.com
Piyasi Mitra is a journalist, features writer and copy editor who has worked with The Times of India and the ABP Group, and is currently exploring content creation in the digital space.

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