Most of the countries are agreeing with the truth that the crypto economy requires a robust framework of regulations along with clarity and awareness regarding digital currency. While no control over crypto can result in criminalization of crypto space, an absolute ban over the emerging technology is also not a solution.
Recently, a South African government has formed a crypto assets regulatory working group dedicated to crypto and blockchain technology. On the development of a team for crypto assets, Tito Mboweni, the South African finance minister announced, “It is anticipated that, following broad industry comment and participation, the crypto assets regulatory working group will be ready to release a final research paper on the subject during the course of 2019.”
Notably, representatives from multiple South African agencies are part of the group with an aim to produce a comprehensive regulatory response to the expanding digital asset economy. Mboweni further elaborates that the regulatory group intends to publish a study of its findings along with ideas which will contribute to a unified cryptocurrency regulatory standard throughout South Africa. The group will utilize resources for governmental response to cryptocurrencies and its surrounding economy.
The finance minister revealed that the SA Revenue Service is considering the idea to add cryptocurrencies in the tax forms for the next year. He adds that provisions must be added so that the taxpayers can indicate the earnings and losses annually with these type of assets.
He noted, “Taxpayers who have made some form of declarations regarding cryptocurrency trades have captured such trade as a form of ‘other trade income’ or ‘other trade loss’, and have made reference to a description of digital/cryptocurrency trading (e.g. bitcoin cash (BCH), litecoin (LTC), ethereum (ETH), zcash (ZEC) to name a few).”
Mboweni concluded that the recommended amendments in the bill would improve the efficiency to the tax office regarding the crypto space. He believes that these amendments would clarify that whether or not cryptocurrencies can be classified for personal use or for taxes involving capital gains.
Back in June, Central Bank of South Africa has carried out an interbank payment system that deploys tokenized fiat currency. Also, the local population in the country is embracing the crypto market.