Lithuania Unveils Guidelines on Cryptocurrency Tax, Regulation and Accounting

Regarding Cryptocurrency guidelines, the Ministry of Finance of the Republic of Lithuania has published guidelines for cryptocurrency and initial coin offerings (ICOs). They are divided into four areas – regulation, taxation, accounting, and Anti-Money Laundering/ Combating the Financing of Terrorism (AML/CFT).
Vilius Šapoka, the minister of finance clarified that the guidelines “describe only part of the aspects examined by relevant institutions, in case of discrepancy between guidelines and positions of institutions, the latter shall prevail,” adding: “We acknowledge that the brave new crypto economy world is here to stay, this is why we encourage and invite its participants to innovate and create in Lithuania.”
On ICO regulation, the Finance minister of Lithuania Vilius Šapoka, said: “Lithuania is one of the first ones in Europe who prepared comprehensive guidelines on the legal framework for ICO projects covering regulatory as well as taxation and accounting.”
The finance minister further added that “Organizing ICO is not regulated by specific legislation,” he continued by saying taking into account different ICO models and different characteristics of tokens, in some cases, such activity may be subject to the requirements of the legislation of the Republic of Lithuania and supervision of the Bank of Lithuania.”
While on Crypto Tax the minister revealed that For corporate and personal income taxes, “virtual currency is recognized as current assets that can be used as a settlement instrument for goods and services or stored for sale.”
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For VAT, it is “considered as the same currency as euros, dollars etc.” For other tax purposes, “other types of instrument, e.g. certain types of tokens, may be recognized as a virtual currency as well.” The document details: “Income received from individual purchases and sales of virtual currencies will be taxed standard 15% fixed income tax rate”
Read Also: U.K.’s FCA Send Warning Letters To Bank CEOs Over Crypto Risks
As for crypto mining, the finance ministry states that “When virtual currency is mined, no goods/services are usually supplied for consideration, therefore, the mining of virtual currency is not subject to VAT,” emphasizing that “the sale of such [crypto] currency in Lithuania is VAT exempt.”
What do you think about this cryptocurrency guidelines?

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Written by Russell


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