The canton of Zug, Switzerland's "crypto valley," has increased the threshold for tax payments with bitcoin (BTC) and ether (ETH) to 1.5 million Swiss francs (over $1.6 million) from the previous CHF 100,000 (over $110,000) with immediate effect.
"The increase in the limit is an important step towards the digital future," Zug finance director Heinz Tannler said in a statement on Friday. "From the second half of 2023 on, another innovation will be possible — paying taxes with cryptocurrencies directly by scanning the QR code on the payment slips issued by the tax administration. This simplified process makes paying with cryptocurrencies even more attractive."
The canton of Zug began accepting bitcoin and ether for tax payments in February 2021 after first announcing the plan in September 2020. The canton of Zug's partner for accepting crypto tax payments has been Swiss firm Bitcoin Suisse since the beginning. As part of the deal, Bitcoin Suisse converts taxpayers' bitcoin and ether into Swiss francs for the canton.
"The Canton of Zug has long been an important hub for the crypto industry. The increase of the threshold for tax payments again demonstrates the leading position of the Canton of Zug in integrating cryptocurrencies," said Bitcoin Suisse CEO Dirk Klee in the statement.
Since introducing the initiative in 2021, the canton of Zug has had around 150 crypto tax transactions with a total volume of around 2 million Swiss francs (over $2.2 million), according to the statement. "Based on the positive experiences so far, the Finance Directorate of the Canton of Zug invites individuals and businesses liable for taxes in the Canton of Zug to try out the new payment channel and pay their taxes with cryptocurrencies," per the statement.
Switzerland has become an attractive hub for crypto firms over the past several years, thanks to its favorable regulatory environment and positive attitude toward digital currencies. Swiss city Zug also accepts bitcoin for tax payments via Bitcoin Suisse since 2016. The Swiss municipalities of Zermatt and Chiasso has also accepted the cryptocurrency for smaller tax payments over the last few years.
© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.