The largest Scandinavian economy is set to confirm that it will reject bitcoin (BTC) as a legitimate currency. Sweden will instead subject the digital currency to taxes and treat it like any other asset, such as arts, stamps, jewellery and antiques. Essentially, Sweden will implement a capital gains tax on any transactions using the cryptocurrency.
“Currencies are traditionally tied to a central bank or a geographic area,” said Olof Wallin, an official at the Swedish Tax Agency who’s drafting rules for bitcoin, in a statement to Bloomberg News. “[It’ll] view Bitcoins as what we call another asset – just like art or antiques.”
In addition, tax authorities and the central bank are looking how to treat those who mine bitcoins. It is being discussed as to whether or not cryptocurrency miners should be classified as businesses, which would then permit them to deduct the equipment they utilize.
This past summer, the Swedish central bank issued a series of concerns it had and listed risks that bitcoin and its competitors pose as payment systems. Sweden might have more of a case as Kapiton, the nation’s biggest bitcoin exchange, was reported to police this month after clients allegedly had their money disappear.
For Swedish regulators, the primary difficulty will be able to track and monitor the bitcoin market because of its size and scope.
We reported this week that the Bank of Finland announced that bitcoin doesn’t meet the criteria to be labeled a currency or an electronic payment method. The Finnish central bank has stated that bitcoin is just another commodity.
In December, the government of Norway said that it does not view bitcoins as legal tender. Again, Norwegian tax authorities will charge capital gains taxes on bitcoin transactions, which will make the alternative currency an asset.