25. Januar 2021

Federal government sees little need for action

A Bitcoin stands upright in front of the German parliament

The recent bull run in Bitcoin and Co. is arousing the interest of many private and institutional investors. In Germany, too, the digital store of value as well as other cryptocurrencies are enjoying increasing attention. However, a question from the FDP parliamentary group in the Bundestag reveals that the federal government is still struggling with the taxation of cryptocurrencies.

Currently, the federal government sees little need for tax changes for cryptocurrencies. This emerges from a question from FDP parliamentary group politician Frank Schäffler to the Federal Ministry of Finance, which BTC-ECHO has received. According to this, the federal government is not currently planning any legal changes of its own regarding the purchase of or Bitcoin Storm payment with cryptocurrencies. It would prefer to follow the EU’s Markets in Crypto Assets Regulation (MiCA), which is currently being planned. The legislative proposal provides, for example, that providers of crypto services should be subject to ongoing supervision. According to the regulation, these services would also include exchange trading on crypto exchanges.

When asked how to treat the purchase of goods and services with cryptocurrencies for tax purposes, the federal government responded:

How to assess the use of cryptocurrencies for the purchase of goods and services for income tax purposes is currently being coordinated between the Federal Ministry of Finance and the supreme tax authorities of the Länder. After the discussion is concluded, a BMF letter coordinated between the federal government and the states will be published.

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According to Frank Schäffler, this vote has not seen any significant progress for eight years now. Regarding the hardly noticeable initiative of the German government regarding cryptocurrencies, the FDP politician says:

Interest in cryptocurrencies is currently growing massively. But the federal government shows no interest in providing citizens in Germany with a secure legal framework for acquisition and taxation

Federal government hardly provides any new insights into Diem

There are also few new findings from the federal government regarding the stablecoin Diem from the Facebook consortium. When asked for an assessment of the planned introduction of Diem in Switzerland, the Finance Ministry referred to the so-called „Diem College“, which was founded on the initiative of the Swiss FINMA and of which BaFin is also a member. Its task is primarily the exchange of information. In this respect, for example, the prudential requirements have been addressed in order to approve Diem as a payment system. However, the demands are not formulated further. The federal government refers to a statement by the Diem Association in which the consortium announced that it would only take up its activities if the Swiss Financial Market Supervisory Authority FINMA approved the stablecoin. However, a decision by the financial supervisory authority is not yet foreseeable.

In response to further questions from the FDP parliamentary group, the letter from the federal government referred to „insufficient information“ on the part of Diem, on the basis of which no precise details could be formulated. Meanwhile, at the G7 meeting in December, Finance Minister Olaf Scholz was not very impressed by the rebranding of the Facebook coin. He even called the Diem a „wolf in sheep’s clothing“. According to the SPD candidate for chancellor, renaming the currency would not solve its fundamental problems. He accuses the Diem organisation and the consortium around Facebook behind it of not having tackled the regulatory risks decisively enough. The German government will not accept a market entry as long as these deficits are not remedied.