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- May 27, 2019
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Emphasizing that the status of bitcoin is still undefined in the country, the judge stated in his ruling that “it was hard to envisage a result whereby bitcoin would be considered a currency for tax purposes in particular,” the news outlet conveyed, noting that the case could reach the supreme court.
Itay Bracha, managing partner at Israeli law firm Bracha & Co. and the head of the firm’s tax department, shared his thoughts with local daily business newspaper Calcalist. He said: “The ruling is a signal to all those who have yet to report cryptocurrency-related profits or based their actions on differing legal advice … The ruling is unequivocal, and since it is not new legalization but a judicial interpretation, it applies retroactively.”
The Case
According to reports, the case involves Noam Copel, founder of blockchain startup DAV. “We’re building a decentralized infrastructure to revolutionize the transportation industry on the blockchain,” the company’s website explains.
Globes reported that Copel bought https://markets.bitcoin.com/crypto/BTC in 2011 and sold them in 2013 for a profit of approximately NIS 8.27 million (~$2.29 million). Asserting that his profits should not be subject to capital gains tax, he told the court:
Bitcoin should be classified as a foreign currency, and that his profits should be seen as exchange rate differences received by an individual not in the course of a business, and therefore should not be taxed.
Itay Bracha, managing partner at Israeli law firm Bracha & Co. and the head of the firm’s tax department, shared his thoughts with local daily business newspaper Calcalist. He said: “The ruling is a signal to all those who have yet to report cryptocurrency-related profits or based their actions on differing legal advice … The ruling is unequivocal, and since it is not new legalization but a judicial interpretation, it applies retroactively.”
The Case
According to reports, the case involves Noam Copel, founder of blockchain startup DAV. “We’re building a decentralized infrastructure to revolutionize the transportation industry on the blockchain,” the company’s website explains.
Globes reported that Copel bought https://markets.bitcoin.com/crypto/BTC in 2011 and sold them in 2013 for a profit of approximately NIS 8.27 million (~$2.29 million). Asserting that his profits should not be subject to capital gains tax, he told the court:
Bitcoin should be classified as a foreign currency, and that his profits should be seen as exchange rate differences received by an individual not in the course of a business, and therefore should not be taxed.