Venezuelan Government Decrees Crypto Operators to Pay Taxes in Cryptocurrency

On Monday, the Venezuelan government published the official gazette No. 6,420 dated December 28, which contains a decree No. 3,719 that points towards new tax payment rules for cryptocurrency users. Dinero publication stated that:

“The government of President Nicolás Maduro published a decree that will require taxpayers who carry out operations in foreign currencies or cryptocurrencies to pay their taxes in that same currency and not in bolivars.”

The decree also stated:

“the Venezuelan people are currently facing a fierce war waged by internal and external factors that pursue the deterioration of the economy, which is why it is necessary to adopt sufficient measures to ensure the strengthening of the current fiscal regime.”

The Ministry of Popular Power of Economy and Finance is in charge of the execution of the decree which is in effect, at the time of press.

The Article one of the decree notes that taxpayers in Venezuela who carry out operations in cryptocurrencies or any foreign currency authorized by the law must “determine and pay [their tax] obligations in a foreign currency or cryptocurrency”.

The decree enlists two exemptions; transactions of securities traded on a stock exchange and the export of goods and services carried out by public bodies or entities. The decree also mentioned that the tax refunds for cases established in the decree will be made in the national currency and not otherwise.

Maracaibo Municipality in Zulia state clarified that it will use the national cryptocurrency, the petro for the calculation of business tax, reported the publication. There was confusion amongst the residents as they thought it meant for non-cryptocurrency users to also pay their taxes in petro.

The intendant of Servicio Desconcentrado de Administración Tributaria [Sedemat], Jean Carlos Martínez clarified to Noticia al Dia publication, a local publication that “taxpayers will not be charged taxes in petros.” He further added:

“We are using the value of the petro as a reference unit to be able to determine the minimum tax since the ordinance of the current economic unit is still stipulated in percentages of gross income.”

He also clarified that the national cryptocurrency, petro has two values, one as a cryptocurrency and the other as a unit of account that translates into 9,000 sovereign bolivars, which will be used in passport procedures or current salaries.

The decree also mentions that the payment of taxes will be carried out depending on the economic activity of each company or microenterprise. Martinez was quoted in the publication saying:

“If someone had transactions in petro, bitcoin or other currency, [they] should declare [their income] according to the currency that [they] manage.”


Source
Author: Namrata Shukla
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Soaring Inflation Sends Bitcoin Trading Volume to [Another] New High in Venezuela

The amount of Venezuelan bolivars being spent to purchase bitcoin has risen to record levels as the South American country experiences unprecedented hyperinflation and a worsening economic crisis.

Per Coin Dance, bitcoins worth nearly 900 million bolivars have been traded so far this week in Venezuela, and this is already higher than last’s week volume of slightly over 850 million bolivars.

Source: Coin Dance

However, this spike in volume cannot be wholly-attributed to the rapid devaluation of the bolivar. Last week also saw the highest number of bitcoins traded in the Latin American country, with residents trading 1,089 BTC worth a present value of $7.1 million on the platform. The record could be broken again as already 955 bitcoins have been traded this week so far. The second half of September also saw bitcoin trading volumes breach a high that had only been reached for the first time last April.

Source: Coin Dance

Seven-Digit Inflation Figures

Venezuela’s growing bitcoin trading market comes at a time when the International Monetary Fund is projecting that the rate of inflation will reach 1,370,000 percent in the Latin American country by the close of this year.

Only three months ago, the international financial institution had forecast an inflation rate of 1,000,000 percent,  but in the intervening period, the government raised the minimum wage 60-fold even as the economy contracted, forcing the revision. Next year, the IMF expects the inflation rate to hit 10 million percent.

Among other reasons, the stratospheric level of inflation could be one of the factors causing an increase in bitcoin trading volumes in the South American country since the maximum supply of the flagship cryptocurrency is capped, making it deflationary.

Petro’s Public Sale

Notably, the expansion in bitcoin trading volumes is coming less than three weeks before the launch of the public sale of Venezuela’s state-backed cryptocurrency, the Petro. As previously reported by CCN, the Petro will be purchased using both the leading cryptocurrencies as well as fiat currencies when the public sale kicks off next month.

“If you have bitcoins you can buy Petros, if you have Ethereum you can buy Petros, if you have dollars or euros you can buy Petros. And from November 5, the Petro … will go on sale to the Venezuelan public in sovereign bolivars,” said Maduro during a television interview last month.

To increase the adoption rate of the Petro, the Venezuelan government earlier this month mandated that all passport fees be paid using the state-backed cryptocurrency. Skeptics also saw the move as aimed at discouraging Venezuelans from leaving the country as emigration has rapidly increased in the face of worsening economic problems in the country.


Source
Author: Mark Emem
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Venezuela’s Maduro Orders Banks to Adopt Petro Cryptocurrency

Venezuelan banks have been ordered to use the petro, the Maduro government-launched cryptocurrency, as a unit of account.

LIONBIT

Wire services AFP reported Tuesday that “all financial information” must be denominated in both the bolivar – Venezuela’s official currency – as well as the petro, which was controversially unveiled in December. Maduro’s government has claimed, without evidence, to have raised billions of dollars during a presale earlier this year, despite pushback from opposition leaders in the country as well as international critics, including the U.S. government.

Indeed, in March, U.S. president Donald Trump approved new sanctions against Venezuela that specifically targeted the petro.

TIP

The development is the latest mandate to come out of the Maduro government related to the petro. It was previously announced that the state-owned oil and gas company Petróleos de Venezuela (PDVSA), will begin using the petro as a unit of account, and officials have also ordered that government-funded pensions and salaries be anchored to the cryptocurrencies.

The latest news also comes on the heels of a United Nations report stating that since 2014, 2.3 million people have fled Venezuela amid the country’s economic crisis.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Anna Baydakova
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Peoples Token

Venezuela’s President Devalues Fiat Currency by 95%, Pegs it to Crypto ‘Petro’

Over the weekend, Venezuelan President Nicolas Maduro began broad economic changes that ultimately ties Venezuela’s currency to the contentious ‘oil-backed’ cryptocurrency Petro.

LIONBIT

As CCN reported, President Maduro announced the plan last week and has followed through. As part of the fiscal changes, The Central Bank of Venezuela devalued the nation’s currency by 95% (about five zeroes) due to the ongoing hyperinflation of the Bolivar. The new value and currency is now renamed to the “sovereign bolivar,” which is pegged to the oil-backed Petro cryptocurrency that Maduro launched earlier this year as an ERC-20 token.

A History-Making Event, but under Poor Conditions

Venezuela’s switch to a cryptocurrency-pegged currency marks the first time that a nation has done so. However, economists warn that the subsequent devaluation will only worsen the inflation rated, which is growing at an annualized rate of a whopping 108,000 percent, according to Bloomberg.

As CCN reported, Venezuelans were already liquidating their bolivars into Bitcoin earlier this year, in spite of a government ban. The population has also been fleeing Venezuela to avoid the momentary crisis, which now borders on a humanitarian crisis. Though the conditions are not rosy for the history-making event for the cryptocurrency, President Maduro ultimately followed through with sweeping monetary changes, while the world watches the eventual outcome.

TIP

The switch to the Petro is far from a solution to the Venezuelan economic crisis. The country still teeters on economic collapse. President Maduro also faces losing power over the country or an outright ousting. An assasination attempt with a drone occurred earlier in August while Maduro gave a speech.

The dramatic changes reflect the “government’s willingness to do what it takes to stay in power,” Raul Gallegos, an associate director at Control Risks, told Bloomberg from Bogota. “Maduro looks vulnerable, clearly something could happen.”

Banks and ATMs have been closed while they scramble to accommodate the new currency rules.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Jack Mathis 
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Petro Announced as Official Currency in Venezuela

Venezuela has been facing economic difficulties for years now, and President Nicolas Maduro is not shying away from any solution. Starting August 20th – next Monday – Venezuela is set to have two official currencies: the bolivar and the petro, to be valued equally and interchangeable.
LIONBIT
According to media reports, in a speech televised on TeleSUR, Maduro said, “As of next Monday, Venezuela will have a second accounting unit based on […] the value of the Petro. It will be a second accounting unit of the Republic and will begin operations as a mandatory accounting unit of our PDVSA oil industry.” He emphasized that, “This system completely end the speculation of the Venezuelan currency.”

This means that Petro will, technically, become bolivar’s stablecoin, similar to what Tether (USDT) strives to become for the US dollar. The president confirmed that the valuations of each currency will come from the Central Bank, and added hints about a new salary system built for paying wages in Petro.

TIP

As Venezuela has the largest oil reserves in the world, the petro is backed by a barrel each – as of January 2014, the country has a total of 297 billion barrels. It is speculated that petro was made as a way for the country to skirt around strict international economic sanctions.

The country’s officials have previously announced their intent to use petro to build “villas for the homeless.” A Venezuelan official added that the controversial cryptocurrency will “represent a protective shield for housing construction.” Meanwhile, the coin itself has been deemed a scam by various rating sites.


Here at Dollar Destruction, we endeavour to bring to you the latest, most important news from around the globe. We scan the web looking for the most valuable content and dish it right up for you! The content of this article was provided by the source referenced. Dollar Destruction does not endorse and is not responsible for or liable for any content, accuracy, quality, advertising, products or other materials on this page. As always, we encourage you to perform your own research!

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Author: Sead Fadilpašić
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