Released Wednesday, the draft circular from the Israel Tax Authority proposes imposing a value-added tax (VAT) on ICOs, differentiating them into two types: service transactions and sales transactions. The draft appeared to indicate that goods or services offered to foreign residents would result in “a zero tax invoice” under current law.
While the draft outlines possible methods for taxing companies launching token sales, it does not touch cryptocurrencies directly, according to an announcement posted on the agency’s website.
The draft detailed different classifications for companies launching campaigns involving the blockchain use case, focusing on the kinds of products or services the company offered as well as whatever profit model it may take.
Token sales which reap more than 15 million Israeli new shekels (INS) in revenue will be subject to bookkeeping regulations in accordance with existing law, according to the draft…
Read Full: Israel Releases Draft Plan for Taxing ICOs