Swiss Government Takes Action To Support Growth Of Cryptocurrency Company

The Swiss government has encouraged blockchain startups to experiment with a new law that reduces legal requirements for blockchain startups without compromising tax benefits.

On June 17, the Swiss National Commission approved several legislative texts in the area of ​​financial law.The changes were requested by the Swiss Federal Commission to remove legal issues related to blockchain applications and information technology distribution.

On June 19, the Federal Commission approved a Federal Reserve report, concluding that existing blockchain tax rules would be enforced.This report was adopted by Congress in 2018 when the government decided to review and revise existing laws.

Switzerland has long been a gathering place for the blockchain market. Especially at the start of the coin boom (ICO) of 2017, Zug was a popular destination for token financial ventures, hence the city's nickname "Cryptocurrency Silicon Valley".Although the ICO wave has slowed down, Switzerland's interest in blockchain technology has not cooled.

Rolf H. Weber, Professor of Business Administration at the Swiss Blockchain Federation and Chairman of the Regulatory Standards Working Group:"As we all know, promoting the blockchain industry in Switzerland has become a political goal."

The Federal Tax Service says Joel Weibel, communications expert:Swiss law requires that the law be applied and open to the police for new technologies.

New rules to help change security tokens

The new rules, most of which are company and securities laws, have made it easier to change security tokens.As it stands, Swiss law is a heavy burden, especially when asking for secure token transfers, Weber said. All returns must be in writing, as in normal exchange.

Tokens differ from digital devices in that they contain the same information or contracts.

"If you change your tokens, you will still change all the members associated with the tokens. This is a change from the new Swiss law."

Christian Meizer

When the law is enacted, owners will have the freedom to register and redeem tokens on the electronic invoice.Developers of accounting technologies provide these services without law.

“The use of digital tokens today is not possible today because the tokens do not have proof of membership. Just like cash, you cannot withdraw cash from a lost merchant.

Joël Weibel

Switzerland will continue to use existing blockchain policies.

The Swiss legislator generally does not regulate new financial instruments, but prefers to apply those that already exist first.

"If there is a problem with an existing policy, we immediately develop a new one."

Founder of the Swiss Bitcoin Association Luzius Meisser

Switzerland sees blockchain technology or crypto assets as a continuation of existing devices rather than as separate organizations.

“We can say that it is the law on the blockchain because all the changes affect the industrial model of the blockchain. However, compared to many countries like Malta or the President of Liechtenstein, Switzerland does not use blockchain politics in a narrow way.

Joël Weibel

Swiss Bitcoin Tax Credit

Two days after the National Assembly vote on June 17, the Federal Council decided not to amend the current Swiss tax code to include a special resolution on zis blockchain technology.Bitcoin mining is exempt from value added tax (VAT), while some security tokens are exempt from tax deduction and non-taxable investment tax.

Switzerland allows tax deductions on income from natural assets such as contracts or goods.These taxes also apply to “sharing tokens” to ensure that all merchants are treated equally.

"However, Swiss law now also allows the benefits of participating companies without tax deduction of the income associated with the benefits. This is now also available through the attractive form of joint ventures."

Joël Weibel

Signed by Luzius,In Switzerland there are special taxes which do not apply to security tokens, but to security."Members of Congress say there is no problem in closing the time gap because the security token market is still very small," he said.

To increase investment income, the state does not tax investment income, and the financial statement to measure the need for new legislation does not see the need to start with crypto.This is great news for crypto sites, as it means lower taxes, at least for now.