Bitcoin Wins in EU Ruling

The European Union’s Court of Justice has ruled that under EU rules, virtual currencies like Bitcoin should be treated as currency, rather than a service which would be subject to a value-added tax. The ruling settles a case between Sweden and a Bitcoin exchange.

The European Union’s Court of Justice has ruled that in the European Union, the exchange of virtual; currencies should be treated like an exchange of regular currency.

The case stemmed from a dispute between Sweden’s tax authority and Daniel Hedqvist, operator of a Swedish Bitcoin forum and exchange.

Sweden wanted to charge a value-added tax on Bitcoin transfers and Hedqvist argued it wasn’t allowable under European Union rules.

The court ruled that when Bitcoin exchanges transfer fiat currencies into Bitcoin for a fee they are exempt from EU rules barring such taxes on transfers of “currency, bank notes and coins used as legal tender.”

The ruling clarifies the status of virtual currencies across the EU.