During the dip, regulation continues. In fact, the German Ministry of Finance published a so-called “BMF letter” that explains how to regulate income tax from crypto. This is the first time such information has been released about cryptocurrency.
What is this letter?
The Ministry of Finance described the letter as ‘legally secure and easily applicable guidance on the income tax treatment of virtual currencies and other tokens,’ according to the Federal Treasury Department’s website.
This letter contains issues about crypto that are explained and classified according to the income tax law. In it, not only is there information about trading crypto, but the ministry even goes into income tax for mining, staking, lending, hard forks, airdrops, utility and security tokens and employee income.
After one year, sales of BTC and ETH are tax-free
One notable decision in the letter, is that the largest two coins may be sold tax-free after one year. Parliamentary state secretary Katja Hessel said:
For individuals, the sale of purchased bitcoin and ether will be tax-free after one year.
But this letter is not comprehensive is for the future. Things can still change.
Of course, the upcoming official publication of the BMF letter is not the end of our discussion on the subject, but an intermediate result. The rapid development of the ‘crypto world’ ensures that we will not run out of topics. An additional letter on the obligations to cooperate and register is already underway.
Germany is #1 in crypto
Germany is the number one crypto country in the world, according to Coincub. The country scores even better than El Salvador which accepts bitcoin as legal tender. This is because crypto investments in Germany are already part of the domestic savings sector.
In addition, the country is number one with the number of bitcoin nodes and the policy on taxation was already progressive, but the Ministry of Finance is adding to it.