Bosnia Introduces Crypto Tax For Taxpayers

Tax Law Amendment Introduces ‘Crypto Tax’ In Bosnia

The Government in Bosnia has developed the intention of taxing national taxpayers holding crypto assets. The country is ready to make sure that people in the country are held accountable for their involvement in crypto.

If they are to operate in cryptocurrencies in the country, then they must strictly adhere to the tax laws and codes in the country.

They must ensure that they are strictly adhering to the rules and regulations set by the Bosnian regulators. If they fail to adhere to them and do not pay the taxes accordingly, things may become difficult for them.

However, existing Bosnian tax law does not provide for crypto taxes which can only be done by amending the laws.

Yet the intention of collecting crypto tax has been revealed by the national tax authority of Bosnia in its recent discussions with the country’s Finance Ministry.

In its suggestions, the Tax Administration authority of Bosnia/Herzegovina recommended to the Ministry levying of the crypto tax.

The officials of the tax authority told Finance Ministry that the crypto industry is rapidly expanding in the country. They opined that the first crypto-powered automated teller machine (ATM) shall soon be installed in the capital of Bosnia.

They opined to the Ministry that national taxpayers should be asked to pay taxes on incomes derived from crypto trading. Similarly, they further proposed that Capital Gain Tax should also be levied upon holding cryptocurrencies.

The officials of the tax authority then recommended amending the existing tax laws for introducing desired tax levies into the laws.

Tax Authority Drew Attention to Article 12 of Existing Tax Law

Officials of the Bosnian tax authority insisted that for achieving the objective, amendments would be required in Article 12 of the relevant law. The said article talks about ‘self-employed’ individuals.

It has been suggested by the officials that such self-employed individuals are involved in other activities in addition to their usual business activities.

The officials pointed out that these individuals have been drawing income from other sources and one of them being cryptocurrencies.

The authority further reminded the earlier statement of the Finance Ministry, wherein the Ministry took note of the crypto industry’s growth in the country.

At that time, the Ministry showed interest in taxing crypto activities such as the trading of digital currencies. However, it was just a viewpoint of the Ministry which was not considered by the Ministry since then.

The tax authority has hence insisted that the Ministry should seriously consider taxing crypto. This way, the country will be able to keep a tab on the crypto activities and the economy may benefit from that.

Ambiguities Identified In the Existing Laws

The tax authority has furthermore identified gaps and ambiguities in the existing tax laws, particularly with regard to cryptocurrencies.

It said that these issues should be addressed immediately for which the authority is ready to suggest its recommendations to the Government.

The authority also appreciated the Government’s efforts in highlighting the issue of crypto for tax purposes.

Bosnia Moving In the Direction of Taxing Crypto Activities

The idea of bringing crypto under the tax net was floated by the Cabinet of Ministers of Bosnia.

In November 2022, the Cabinet took constituted a working group for ‘crypto’ which was to be led by Bosnian Security Ministry.

The group was assigned the responsibility of determining the risks and other factors which could potentially stem from digital assets.

It was the concern of the Ministry to see what could be the consequences of engaging with virtual assets. For instance, the Cabinet was concerned with the use of digital assets for money laundering, terror funding, etc.

It was in this background, the Group was constituted to prepare a risk assessment report in light of the Cabinet’s concerns.

In this regard, the group was advised to follow the method adopted by the Council of Europe. Furthermore, the group was also tasked with the duty of determining the potential challenges and submitting its report to the Cabinet.

Leave a Reply

Your email address will not be published. Required fields are marked *