Favorable tax changes in crypto currency in Poland

Pursuant to the new regulation issued by the Polish Minister of Finance on July 11, 2018 regarding the cessation of collection of tax on civil law transactions from a sale or exchange of a virtual currency, published on the basis of art. 22 § 1 point 1 of the Tax Code – according to which: “the minister competent for public finance may, by regulation, in cases justified by public interest or important interest of taxpayers: stop all or part of the collection of taxes”, there was introduced the cessation of the collection of tax on civil law transactions from taxpayers who purchase virtual currency referred to in Art. 2 para. 2 point 26 of the Act on Counteracting Money Laundering and Terrorism Financing. These are beneficial changes for those who trade in crypto currency. According to the information obtained from the Polish Ministry of Finance, the new regulation is a response to the controversy regarding the interpretation line in respect of civil law transactions tax on the sale and exchange of cryptocurrencies. According to the regulation of 11 July 2018, the civil law transactions tax will not be charged for almost a year. The exemption is, however, only temporary. According to the announcements of the Ministry of Finance, the work is still underway as regards the complex solutions that will normalize the entire cryptocurrency market also in the tax context. The new regulation is a step towards the standardization of the legal and tax situation of the cryptocurrencies market in Poland, but at the same time, it may put in a disadvantageous situation those taxpayers who carried out the transactions of sale and exchange of cryptocurrencies before the entry into force of the new regulation. The regulation came into force on July 13, 2018.