Bitcoin transactions will be exempt from Value Added Tax (VAT), the European Court of Justice (ECJ) has ruled.
According to the Financial Times, the ECJ said that bitcoin transactions “are exempt from VAT under the provision concerning transactions relating to currency, bank notes and coins used as legal tender.”
The ECJ’s long-awaited ruling comes after its Advocate General Juliane Kokott urged the court to refrain from applying tax to bitcoin purchases and sales, in an opinion document published in July.
The European court first looked into bitcoin taxation in June last year after the Skatterverket – Sweden’s tax office – challenged a court decision that ruled bitcoin transactions in the country should be exempt from VAT, following a dispute with bitcoin forum operator Daniel Hedqvist.
European Courts of Justice image via Peter Fuchs / Shutterstock.com