#Public Sector

Norway says Bitcoin isn’t real money, will impose tax on savings

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Days after European Banking Authority (EBA) issued a warning against virtual currencies like Bitcoin, Norway has said that Bitcoin isn’t real money and they will treat savings in Bitcoins as assets, which will be subject to capital gains tax.

Just last week EBA reminded consumers of the risks involved with virtual currencies. The EBA asked users to ensure that they fully understand the characteristics of virtual currencies like Bitcoin and don’t use real money that they can’t afford to lose to invest / buy Bitcoin.

Hans Christian Holte, director general of taxation in Norway, while speaking to Bloomberg said that Bitcoin doesn’t “fall under the usual definition of money or currency” and will instead be treated as an asset which will be taxable as capital gains. Germany resorted to a similar stand earlier in August.

Korea has already denied a legal monetary status to Bitcoin while China’s Central Bank also said that it doesn’t recognize Bitcoin as a legal currency and reminded banks in the walled country about the risks involved.