Both the capital increase and other income will receive any charge in taxes. Bitcoin has awakened the interest of various foreign companies in the field. This interest would bring many benefits to the country.
The Government of El Salvador has decided to free foreign investors from paying taxes on their earnings in bitcoin (BTC). The cryptocurrency already became legal tender in that country on September 7.
Javier Argueta, legal adviser to President, Nayib Bukele confirmed the situation to the AFP news agency, according to the France24 medium. The advisor explained that If a person owns assets in bitcoin and manages to make a profit, 0 taxes will be applied.
In this way, both the capital increase and the income obtained from holding the cryptocurrency will not be affected by any tax. The first goal of the administration, headed by Bukele, is to attract investment from other countries to boost their economy.
Bitcoin and its First Steps in El Salvador
The crypto community has high expectations regarding the adoption of bitcoin as a legal currency in El Salvador.
This recognition of the cryptocurrency (the first official worldwide) generated interest from many foreign individuals and companies, which are even starting to realize how to take their operations to the Central American country.
A clear example of this whole trend is the Argentine company Lemon, which will facilitate the acceptance of cryptocurrencies for Salvadoran financial entities, as its CEO announced to this medium.
On the other hand, the Mexican cryptocurrency exchange Bitso reported they would play a role as one of the first providers of Chivo Wallet, the state-owned bitcoin wallet.
Big Companies are Joining the Crusade
Finally, the fact that multinationals such as Pizza Hut and McDonald’s already accept payments with that cryptocurrency in the country has attracted alarming attention in media all over the globe.
OpenNode also revealed the alliance between them as the provider of payments in bitcoin and McDonald’s, indicating that, throughout the country, these restaurants would be receiving payments via Lightning as of today. The franchise has just over 20 stores nationwide.
This union came to terms because the confirmations of on-chain transactions take too long and do not keep up with the rhythm of McDonald’s. With a network like Lightning, these payments happen instantaneously and do not represent an obstacle for regular customer order fulfillment.
This boom and the tax benefits revealed the strategy of Nayib Bukele to boost his national economy by encouraging the adoption of bitcoin by the Salvadoran population and investors who may arrive in the country.
Many businesses will be providing their services in El Salvador, from digital wallets and mobile payment operators, insurance companies, and relevant retail merchants in the country, through fast-food restaurants and industrial firms.
By: Jenson Nuñez