Costa Rican Lawmakers Propose To Eliminate Almost All Taxes On Bitcoin• October 27, 2022 10:28 pm • Comments
It looks like lawmakers in the country of Costa Rica are now working to significantly reduce taxes on Bitcoin and crypto in general.
If the proposal goes through, it could make the Central American country a very popular crypto hub as crypto supporters move their to avoid taxes.
Costa Rican lawmaker Johana Obando was the one who proposed the bill to Congress in order to further create regulations that are favorable to both the crypto industry and the Central American economy.
This new law would be called the Cryptoassets Market Law (MECA) which would provide individuals the protection that they need for their crypto assets and allow for decentralization in a way that still works in parallel with the country’s central bank.
— Decrypt (@decryptmedia) October 27, 2022
The idea is to have a law that recognizes what digital assets are and allow those who want to buy, sell, spend and store their crypto do so—without interference from the Costa Rican government.
Presented along with Congressmen Luis Diego Vargas and Jorge Dengo, the bill would not allow the government to tax cryptocurrencies when used to buy goods.
It also wouldn’t let the government tax crypto sitting in cold storage—and crypto produced by the mining industry wouldn’t be subject to profit tax, either.
Profits from crypto trading, however, would be subject to income taxes under the bill.
Essentially, it looks like regulators and lawmakers within Costa Rico are understanding the value of digital assets and are allowing for their citizens to use it however they see fit.
As a result, this could bring a lot of foreign capital to the country and in turn provide economic benefits for the citizens.
With that being said, there are difference between this new proposal and other laws such as El Salvador’s Bitcoin law.
In Costa Rica, Bitcoin is still not considered legal tender the same way it is in El Salvador.
However, there are no restrictions on the use of crypto and lower taxes on them is a way to help increase the popularity of digital assets.
— Token Spoken (@0xTokenSpoken) October 27, 2022
El Salvador became the first country in the world to adopt Bitcoin as legal tender. But the Central American nation’s president, Nayib Bukele, has been criticized for the law (and his personal investments in cryptocurrency, which he claims he buys on a whim, naked on his phone.)
The Costan Rican bill is similar to the one presented in Panama earlier this year: the so-called Crypto Law wanted to regulate the use of Bitcoin and legalize decentralized autonomous organizations (DAOs)—but the country’s president vetoed it.
Elsewhere in Latin America, Paraguay is working to draw up clear regulations for the Bitcoin mining industry, and Chile’s senate this month approved a fintech bill which hopes to regulate the crypto industry.
Lawmakers in Costa Rica are working to eliminate nearly all taxes on #Bitcoin , which would attract foreign investors and fintech companies while also creating jobs for locals.
— Pipshunters (@Pipshunters1) October 27, 2022
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