By CCN: An Israeli court has ruled that Bitcoin is not a currency but rather an asset. This was in a case brought forth by Noam Copel, a blockchain entrepreneur, according to business publication Globes. The ruling means that Copel will pay taxes of New Israeli Shekel (NIS) 3 million ($830,115). This is after making profits of over NIS 8 million ($2.2 million) trading bitcoin six years ago.
In the course of presenting arguments, Copel had made the case that bitcoin should be classified as a foreign currency. The country’s tax collection agency, Israel Tax Authority, had made the opposing argument that bitcoin should be categorized as property.
The ruling could still be appealed at a higher court by Copel.
How Much Bitcoin Tax Was Copel Trying to Avoid?
Per Globes, in 2013 Copel sold bitcoins he had acquired in 2011. He made a profit of over NIS 8 million. One of his arguments was that bitcoin should be viewed as a foreign currency such as the dollar.
Further, Copel urged the court to view the profits made as differences in exchange rates and therefore not taxable. Besides paying the tax on capital gains of his bitcoin holdings, Copel will also meet legal costs totaling NIS 30,000 ($8,300).
In his ruling, Judge Shmuel Bornstein said Bitcoin could not be classified as a currency since its staying power is not guaranteed. The tax agency’s position was that Bitcoin did not meet the qualities of a currency. Therefore, the argument went, it could not be a foreign currency.