At first, governments assumed Bitcoin didn’t exist. When cryptocurrencies use became rampant, governments were divided on whether to ban, be patience, or adopt and regulate. Until today, most governments have chosen to take a step back and monitor. However, a few like China have opted to ban, while others such as Japan, South Korea, the UK, USA, and Canada, are in agreement that Bitcoin and cryptocurrencies are here to stay.
Bitcoin for Property Taxes
Well, Canada is the latest to allow its burgeoning cryptocurrency community to pay property taxes using Bitcoin. Residents in the country’s City of Richmond Hill will soon be allowed to pay their taxes in Bitcoin.
According to Carmine Perrelli, deputy mayor, Richmond Hill:
“Any Richmond Hill resident who wants to pay with cryptocurrency will go through a mediating company, and those people will convert the cryptocurrency into Canadian currency. We want to give our citizens and our residents every opportunity to pay with whatever currency they have.”
Although the deputy mayor noted that the city doesn’t have a vast cryptocurrency following, he admitted that some city residents are “curious about it (crypto).”
There’s No Risk in Accepting Bitcoin
Perrelli continued to note that the city was initially worried by the crypto price fluctuations, risks, and cost. Fortunately, from the City of Richmond Hill’s “perspective, there’s no risk, there’s no cost, and all we’re doing is providing an extra level of service.”
For the deputy mayor, even though the cryptocurrency prices fluctuate, the city will not bear the risk since they are using a mediator who interfaces with the taxpayers. In tow, Innisfil, another town in Canada, already accepts Bitcoin to pay taxes.
According to Innisfil’s mayor, Lynn Dollin, although they enabled tax payment in Bitcoin, they weren’t expecting any of its residents to use the option. Surprisingly, two individuals have adopted the option which “is about being future-ready.”
Unfortunately, not all in Canada have the same view as the government. For example, Andreas Park, an associate professor of finance, University of Toronto, said:
“It could be a cryptocurrency, but it would be a stable coin. A stable coin means essentially it is something which is the same thing as the Canadian dollar, except that it lives on the blockchain. Why can’t the people who have the Bitcoin, why can’t they convert it into Canadian currency and then send them the Canadian currency? Why are we spending resources, even thinking about this?”
Bitcoin for Taxes Common in US
Apart from Canada, the United States is also at the forefront in enabling crypto enthusiasts to use Bitcoin to pay for their taxes.
Towards the end of 2018, the US state of Ohio passed a bill that allows the state’s authorities to accept tax payment in Bitcoin. Notably, the bill enables payment of everything “from cigarette sales taxes to employ withholding taxes with Bitcoin.”
In early 2018, the senate of the US state of Arizona allowed its residents to use Bitcoin when paying their Income tax. However, the bill was later clouded with controversies and called for more consultations.
According to the Arizona State Representative, Jeff Weninger:
“[The bill] is sending a signal to everyone in the United States and possibly throughout the world that Arizona is going to be the place to be for blockchain and digital currency technology in the future.”
Seminole County, Florida, adds to the mounting number of jurisdictions accepting cryptocurrency for tax payments. To Joel Greenberg, the county’s tax collector, this is one way to “bring government services from the 18th century into the 21st century is the addition of cryptocurrency to our payment options.”
Notably, countries all over the world are considering activating paying taxes with Bitcoin and other cryptocurrencies, but the ideas are stuck in the legislature.