The Israeli government confirmed on Monday that it will consider bitcoin and other crypto-currencies for tax purposes as property.
The notification confirms past hints that the Internal Revenue Service will treat the Crypto currency as property, not as a currency and tax it with the appropriate tax. The position of the Internal Revenue Service was first described in the draft circular issued in January this year.
The circular explains that the profit from crypto-currencies will be taxed on capital gains - from 20% to 25%, while individual miners or crypto-currency traders connected with enterprises should pay a 17% VAT on VAT in addition to capital gains tax. For the first time, the Israeli government thought about taxing crypto currency in 2013.
The draft circular, which preceded the notification on Monday, also outlined the proposed tax options for ICO projects. Possible steps include setting a minimum threshold for the sale of tokens, under which tax liabilities occur.