Taxable Under Current Law
WoW gold - contractual right to goods or services in WoW market, taxable unless WoW license is so restrictive that the WoW gold cannot be considered property.
Magic cards - tangible person property - taxable
collectable hockey cards - tangible person property - taxable
marbles - tangible person property - taxable
pokemon cards - tangible person property - taxable
street creds - to the extent that these represent oral contractual rights to goods or services - taxable.
Now, its not cost effective for the government to enforce these if their primary goal is to generate revenue. But if they just want to go after you for tax āfraudā and money is not an object, then legally there is nothing to prevent them from doing so. Welcome to the modern state.
Understood @nicklambert no worries. I think Iāve read before that there is someone is building a decentralized music platform, this is something I hope they incorporate. Although I really feel this feature could be so useful that having it accessible through the api could be worth it. things will happen one step at a time otherwise the project would be fumbling over itself I understand that for sure. I just want to see the safe network take the world by storm but I shall contain myself
Its amazing how broad they can make these regulations when no one is looking, and they donāt often enforce them. But if anybody makes too much money, or if you piss off the wrong public official, then BAM, they can get you.
Thatās a good point. I have sent a question to the tax authorities here in Sweden. Hopefully itās only when/if I convert safecoins into a fiat currency or buy something outside the SAFE network when taxation is applicable. If so then everything within the SAFE network is free from taxation, at least in my country.
I very much doubt this is the case or it would be a massive tax loophole. Certainly it isnāt the case in the UK as I noted in my post above - tax liability on a capital gain is incurred when you exchange the asset for anything, not just fiat.
This is not tax advice, donāt act on it without checking the facts as these can change at any time, differ from place to place, and I may be wrong.
My understanding (not necessarily correct but Iāll bet it is), of UK tax law today:
If you earn Safecoin, this would be taxable as income (in kind).
If you have Safecoin (bought, earned whatever) and the value rises, as soon as you exchange it for something else, it becomes subject to capital gains tax rules.
So if the earnings or gain is high enough it would be taxable.
I forgot to reply to this. Wouldnāt it only be a tax loophole if people could earn safecoins without tax and then convert it to fiat currencies or goods or services outside the SAFE network? As long as the safecoins remain within the SAFE network they can remain free from tax since there would always be tax when the safecoins are converted to something outside the SAFE network.
You could argue that to begin but it is self defeating because it would become a tax loophole as services were attracted in order to exploit the people using it as a tax shelter. All tax scans start out legal. One after another they are conceived or created, become used, become massively exploited, come to the notice of the public, are closed by the authorities.
Anyway, fact is, this loophole was closed in the UK more than a decade ago, when the criminals in the city of London were being paid in diamonds and other goods to evade tax.
While we are at it shouldnāt we also pay taxes when we watch ads and get a free product in return? The work we do is to give our attention to something and our pay is the free product we are given in exchange. Without selling our attention we wouldnāt get any free product so thereās definitely an exchange of value here.
I think I just gave the government a whole new revenue stream.
Except where exceptions are made, technically yes. But obviously this is because laws can never be perfect and thereās always a need for laws to be implemented according to the intent behind them, to be reasonable etc (at least under UK law).
Gah what is it with you statists and finding every excuse to pay taxes. Taxes and government are obsolete and not needed. But if you did tax advertising that would just be more of a reason for people not to view it and that would cut into business profits which would inevitably lead to businesses lobbying government not to tax advertising.
Yes but how are they going to track that? If I have $500 worth of safecoin and give user A that safecoin in exchange for cash money. Then I go down to the computer store and buy a laptop with said cash yeah I might have to pay sales tax but Iām not going to be paying sales tax on the selling of my safecoin. Furthermore taxes would only apply with registered businesses. AND as was pointed out in other threads given the advance of blockchain technology (I know safecoin doesnāt use a blockchain, but the tech still exists) anyone can incorporate in any country thereby giving any business the flexibiity of a multinational corporation. I would indeed like the details of this. So combine safecoin with multinational incorporation abilities which allow one to be exempt tax laws and really all this talk about paying taxes with safecoin doesnāt apply as much as people will be bypassing such systems.
Also remember maidsafe doesnāt need an uber computer to run and has a much wider audience. So one most likely would not have to go through a coin exchange just to make small currency exchanges. Local friends and connections could do that nicely. Which means no need for bank accounts or credit cards.
I agree that the law is one thing, and detection enforcement another, butā¦
is not necessarily the case and so it certainly isnāt safe (ahem :-)) to assume this. Also, its incorrect to say taxation would only apply to registered companies.
In practice, as with doing a neighbour a favour and being paid in kind, I agree that for most ordinary folk farming enough safecoin to pay for a relatively small amount of safe services (such as storage), the tax due would not be significant, if anything at all. In this kind of case, I donāt think it is an issue (see my earlier post), but it would be risky to extend that logic to larger scale earnings, or large rises in the value of assets held in Safecoin.
but I shall contain myself