Harbinger Tax Is a Hybrid Solution To Domain Names: Ethereum Co-Founder

Ethereum Co-founder and famous crypto analyst Vitalik Buterin participated in a twitter thread on domain names talking about the importance of …

Harbinger Tax Is a Hybrid Solution To Domain Names: Ethereum Co-Founder

Harbinger Tax Is a Hybrid Solution To Domain Names: Ethereum Co-Founder

  • The thread began with American entrepreneur Scott Banister losing his NIST account.
  • Balaji Srinivasan replied that he loved the idea in theory but had doubts about its practicality in functioning.
  • This exchange is similar to the thread by Uniswaps Exchange Engineer Noah Zinsmeister.

One of the hottest topics in the crypto-market right now is the domain pricing on small character names. Ethereum Co-founder and famous crypto analyst Vitalik Buterin participated in a twitter thread on domain names talking about the importance of Harberger tax on them.



He believes that not doing so will encourage corruption in the long run. He further also spoke of Harber
ger Tax as partial ownership and explained his insights on how it can prevent a monopoly.

The thread began with American entrepreneur Scott Banister losing his NIST account. His wife and entrepreneur, Cyan Banister, announced that the report had been stolen and changed. She further said that they could not retrieve it due to the new rule on 4-character names.

Order of events: This account @im_ice_cubes stole my husband’s account (those followers are his) and changed the name of the account making @nist availble. Why they would do that seems fishy. Husband couldn’t get name back because it is four letters (new rule). Gov takes it. https://t.co/HPlsPLW3ts

— Cyan (@cyantist) December 28, 2019

This intrigued Balaji S Srinivasan, the cofounder of Coin Centre, who believed that domain names and user names should be private property. He stated that in the medium term, the current regulations would lead to sites that create tradeable usernames.

“I believe new sites will create that use crypto domains and NFTs for tradeable usernames,” He said. This evoked a response from Vitalik, who spoke of Harberger tax as a means to counter first-mover privilege.

Incredible series of events.

Scott Banister has accepted the outcome — but in the medium term, I believe new sites will be created that use crypto domains and NFTs for tradeable usernames.

These should be private property. https://t.co/2hy0lYmlCm

— Balaji S. Srinivasan (@balajis) December 28, 2019

Eh, IMO small-letter names should be Harberger-taxed or something similar. Otherwise the system feels attractive in the short term but first mover privilege corrupts it in the long term.

— vitalik.eth (@VitalikButerin) December 28, 2019

A user, marc, asked the Ethereum Co-founder to explain the functioning of the Harberger tax. In response to that, Vitalik said that it is a partial ownership system. “. The owner sets a price at which anyone can buy the asset from them, and they must pay a tax proportional to that price.” He added.

He also explained that the objective of the tax is to counter the monopoly in the system and obtain revenue that can use for funding.

Drop me your best insight into Harbinger tax, Vitalik.

Haven’t spent time to consider it but in a perfunctory glance I see nothing. In fact, I see an obscure reaffirmation of something quite a bit broader and what is likely the end goal regardless.

— Marc (@azeroz) December 28, 2019

Balaji Srinivasan replied that he loved the idea in theory but had doubts about its practicality in functioning. In such a system, setting the price too low will, and it brought out under, whereas setting it too high will lead to a substantial annual fee. He wondered how the everchanging rates of the crypto market would cope with the system.

He questioned if the system will house a 30 – day repricing policy. He also pointed out that this will disadvantage small start-ups. They will either forced to pay a large amount of tax or have their name bought by more prominent companies.

I love the idea in theory. Set the price of your property too low, and it might get bought out from under you. Set it too high, and you have to pay a huge annual fee.

But given how dynamic the prices of real estate or crypto are, I’d like to see how it works in practice.

— Balaji S. Srinivasan (@balajis) December 29, 2019

So, two thoughts.

1) Is there an optimal re-valuation period? Eg every 30 days you reprice it?

2) It seems to cause uncertainty for small startups and disadvantage them vs large cos. Either the startup pays a big fee, or the bigco can just buy their name out from under them.

— Balaji S. Srinivasan (@balajis) December 29, 2019

To this, Vitalik Buterin recommended a limited price-capped version. He suggested a 250 USD per year annual fee for anyone who wanted to keep their name. To pay less than the amount, one must open his doors for anyone who wants to buy it at (the annual fee you pay) / (the tax rate).

He also proposed the function asymptotic: buy price = fee * 250 / tax rate / (250 – fee) to get rid of the sharp cliff. He stated that the goal is to tax the ‘squatter ecosystem’ and “force them to serve the public good more.”

I recommend starting with a limited price-capped version: if you pay $250/year, no one can take the name away from you. The main goal would be to tax the squatter ecosystem and force it to serve the public good more.

— vitalik.eth (@VitalikButerin) December 29, 2019

To clarify, if you pay *less than* $250/year, then someone can grab it from you at a price of (the annual fee you pay) / (the tax rate). You can also get rid of the sharp cliff by making the function asymptotic: buy_price = fee * 250 / tax_rate / (250 – fee) pic.twitter.com/VybsgQHU2y

— vitalik.eth (@VitalikButerin) December 29, 2019

Balaji Srinivasan agreed by pointing out that with a price for premium domain registrations, one can tax the squatters without harming the start-ups.

That’s interesting. So essentially for the price of a premium domain registration (some like .inc are $900+), you can deter squatters without imposing too high a fee on startups.

This is a good site to calibrate the exact numbers:https://t.co/YtkaNxEhznpic.twitter.com/FEXw6qUMie

— Balaji S. Srinivasan (@balajis) December 29, 2019

Vitalik Buterin further added that the objective of the Harberger tax is to optimally impose the colonists and ensure that the resale value is proportionate to the actual amount. It also has the advantage of providing a standard interface for sales, he said.

Right. The goal is that under harberger tax the optimal price for squatters to set resale prices is proportional to the actual value of the domain, so the squatter ecosystem is incentivized to set prices optimally to avoid domains going too slow *or* too fast…

— vitalik.eth (@VitalikButerin) December 29, 2019

… *and* they’re forced to offer sales through a standard interface instead of brokers or stupid one-on-one negotiations. Oh, and you’re also taxing the squatters every year, and your tax can actually capture a substantial portion of the value of the system

— vitalik.eth (@VitalikButerin) December 29, 2019

This exchange is similar to the thread by Uniswaps Exchange Engineer Noah Zinsmeister, who complained that a $160/$640 price for a 4/3-character name was ridiculous, and ENS should look at a system where “yearly Harberger-style auctions with a hard max that give existing owners priority.”

The fact that 4/3-character @ensdomains names cost $160/$640 _per year_ is pretty ridiculous. At the very least wouldn’t yearly Harberger-style auctions with a hard max that give existing owners priority if reached be better than this?

— Noah Zinsmeister (@NoahZinsmeister) September 5, 2019

With these multi-faceted views coming in, it is difficult to anticipate where the future of the domain names system and Harberger tax lays.

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Corporate Tax Software Market Size Segmentation, Analysis by Recent Trends, Development by …

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  1. Some of the Major Highlights of TOC covers:

    Chapter 1: Methodology & Scope

    Definition and forecast parameters

    Methodology and forecast parameters

    Data Sources

    Chapter 2: Executive Summary

    Business trends

    Regional trends

    Product trends

    End-use trends

    Chapter 3: Corporate Tax Software Industry Insights

    Industry segmentation

    Industry landscape

    Vendor matrix

    Technological and innovation landscape

    Chapter 4: Corporate Tax Software Market, By Region

    Chapter 5: Company Profile

    Business Overview

    Financial Data

    Product Landscape

    Strategic Outlook

    SWOT Analysis

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Microsatellite Market 2019 Europe Industry Size, Outlook, Share, Demand, Manufacturers and …

Microsatellite Market 2019 Europe Industry research report is a professional and in-depth study on the market size, growth, share, trends, as well as …

Microsatellite

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Some Major Points from Table of Content (TOC)

1 Microsatellite Introduction and Market Overview

1.1 Objectives of the Study

1.2 Definition

1.3 Market Scope and Market Size Estimation

1.3.1 Market Concentration Ratio and Market Maturity Analysis

1.3.2 Europe Value ($) and Growth Rate from 2013-2026

1.4 Market Segmentation

1.4.1 Types

1.4.2 Applications

1.4.3 Research Regions

1.4.3.1 North America Production Value ($) and Growth Rate (2013-2018)

1.4.3.2 Europe Production Value ($) and Growth Rate (2013-2018)

1.4.3.3 China Production Value ($) and Growth Rate (2013-2018)

1.4.3.4 Japan Production Value ($) and Growth Rate (2013-2018)

1.4.3.5 Middle East & Africa Production Value ($) and Growth Rate (2013-2018)

1.4.3.6 India Production Value ($) and Growth Rate (2013-2018)

1.4.3.7 South America Production Value ($) and Growth Rate (2013-2018)

1.5 Market Dynamics

1.5.1 Drivers

1.5.1.1 Emerging Countries

1.5.1.2 Growing Market

1.5.2 Limitations

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2 Industry Chain Analysis

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2.2.1 Major Players Manufacturing Base and Market Share in 2017

2.2.2 Major Players Product Types in 2017

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2.3.1 Production Process Analysis

2.3.2 Manufacturing Cost Structure

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2.3.4 Labor Cost

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3 Europe Microsatellite Market, by Type

3.1 Europe Value ($) and Market Share by Type (2013-2018)

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3.3 Europe Value ($) and Growth Rate by Type (2013-2018)

3.4 Europe Price Analysis by Type (2013-2018)

4 Microsatellite Market, by Application

4.1 Europe Consumption and Market Share by Application (2013-2018)

4.2 Downstream Buyers by Application

4.3 Europe Consumption and Growth Rate by Application (2013-2018)

5 Europe Microsatellite Production, Value ($) by Region (2013-2018)

5.1 Europe Value ($) and Market Share by Region (2013-2018)

5.2 Europe Production and Market Share by Region (2013-2018)

5.3 Europe Production, Value ($), Price and Gross Margin (2013-2018)

5.4 North America Production, Value ($), Price and Gross Margin (2013-2018)

5.5 Europe Production, Value ($), Price and Gross Margin (2013-2018)

5.6 China Production, Value ($), Price and Gross Margin (2013-2018)

5.7 Japan Production, Value ($), Price and Gross Margin (2013-2018)

5.8 Middle East & Africa Production, Value ($), Price and Gross Margin (2013-2018)

5.9 India Production, Value ($), Price and Gross Margin (2013-2018)

5.10 South America Production, Value ($), Price and Gross Margin (2013-2018)

Continued…

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Why Portugal’s Tax-Free Crypto Trading Matters for Bitcoin

Why Portugal’s Tax-Free Crypto Trading Matters for Bitcoin … “Portugal does not tax the increase of value of any currency nor the gain on the sale of …

Cryptocurrency enthusiasts and businesses in the industry have had to put up with regulatory uncertainty for quite some time. The strong desire to tap into their incomes and profits goes hand in hand with failure on behalf of authorities and regulators to fully understand the nature of decentralized digital assets. Not to mention how absurd the reluctance to legalize something they want to tax anyway. Cases in Portugal show that it’s hard to positively know what exactly traders, investors and companies owe the state. Luckily, the narrow scope of the local tax legislation means they have to pay less than in other countries.

Also read: Crypto Salaries Gain Regulatory Recognition Around the World

Crypto Exchange Exempt From VAT, Trading Gains Spared From Tax

A report by the Portuguese business daily Jornal de Negócios, quoted recently by crypto outlets whose interpretation was then copied by mainstream media, released some details about the Portuguese tax system that turn the country into sort of a crypto tax haven, at least until powers in Brussels make up their mind about bitcoin taxation or Lisbon amends its tax code. According to the newspaper, the Portuguese Tax and Customs Authority, which had already determined that crypto trading income is not subject to taxation, has recently stated that cryptocurrency exchange and payments are exempt from VAT.

The latest clarification has been issued by Autoridade Tributária e Aduaneira (the Portuguese Tributary and Customs Authority) in response to a request from a Portuguese company planning to establish a crypto mining operation. The owners wanted to acquaint themselves with the legal provisions that govern the accounting procedures and tax obligations related to the activity. In its filing, the entity explains the process of minting digital coins and notes, and that there are two aspects that concern taxation – the miner’s reward in cryptocurrency and the exchange of that yield into fiat money. In its reply, the tax authority quotes local regulations and European law to conclude that the transactions related to mining, both the remuneration and the exchange, should be exempted from VAT.

An earlier statement by the agency addresses another aspect of crypto taxation. The document was issued almost three years ago in response to a request for guidance on how tax rules apply in relation to revenue received from the purchase and sale of cryptocurrencies. In its explanation, the regulator notes that cryptocurrencies can generate different types of taxable income. These include gains from buying and selling digital coins, commissions charged for the provision of services related to acquisition or use, and gains derived from the sale of products or services for cryptocurrency.

Why Portugal’s Tax-Free Crypto Trading Matters for Bitcoin

Portuguese tax agents elaborate that income generated by trading can fall in three different categories – capital gains (G), capital income (E) and corporate or professional income (B). Category G covers the sale of securities, financial derivatives, certificates whose holders can receive value from an underlying asset, and some other instruments. However, as legislators have chosen to adopt a closed definition, tax can be levied only on the items mentioned in the law, and cryptocurrencies are not in the list. Digital coins do not fall in category E, either, which pertains only to income generated from capital investments.

If applicable, category B prevails over the other two. Income in this category is taxed based on the exercise of an activity and not according to its source. Portugal’s tax code states that if this is an activity oriented toward profit making, the taxpayer is obliged to issue invoices whenever they sell a product or provide a service. The tax agency then draws the conclusion that the sale of cryptocurrency is not taxable under the current tax legislation unless it constitutes a taxpayer’s professional or business activity, in which case it will be taxed in category B.

The current state of the tax treatment of crypto trading conducted by private individuals was confirmed by a representative of the professional services network Deloitte. “Portugal does not tax the increase of value of any currency nor the gain on the sale of any currency. Obviously, any currency losses may not be offset against any gains either,” explained Luis Leon, tax partner at Deloitte Portugal. Noting that the matter has already been analyzed by the country’s tax authority, which issued a ruling with this position, Leon told news.Bitcoin.com:

Cryptocurrencies are no different from a Portuguese tax perspective. Accordingly, the appreciation of cryptocurrencies or any gains on the direct sale of cryptocurrencies are not taxed in Portugal.

In that context, Portugal is a positive example in Europe, where many other countries tax profits from crypto trading–either by imposing capital gains tax or as part of the income tax base in general. Other exceptions in the region include Slovenia, where capital gains of individual investors trading cryptocurrencies are not reported and taxed, and Belarus, which last year introduced tax breaks for crypto incomes and revenue from mining, issuing, and trading coins for a period of five years. Malta and Germany do not tax long-held crypto assets. And in Switzerland, cryptocurrency gains of individual traders are treated as tax-exempt capital gains, but an annual wealth tax is levied on the total amount of coins you hold as part of your net worth.

Which Taxes Apply to Cryptocurrencies

To better understand how taxation affects crypto incomes and profits, one needs to have a basic idea of the differences between the main types of applicable taxes. In most cases, both natural persons and corporate entities are obliged to pay a number of direct and indirect taxes. A direct tax such as the personal income tax is imposed upon a person or their property, while an indirect tax like VAT is levied on transactions.

Crypto incomes can fall under multiple categories depending on the legal status of the taxpayer and the nature of the transaction. In countries where the Value Added Tax system is implemented, the majority of the world’s jurisdictions, VAT is typically charged on the final value of a product or service sold to an end user. Currencies are neither products nor services, so by default no VAT should be imposed over their purchases or sales in exchange operations.

There’s an ongoing debate about the nature of decentralized digital coins. In some countries, different regulators have varying opinions on how to treat cryptocurrencies. In the U.S., for example, the Treasury referred to bitcoin as a convertible decentralized virtual currency in 2013. Two years later, the Commodity Futures Trading Commission (CFTC) classified it as a commodity. At the same time, the Internal Revenue Service (IRS) taxes cryptos as property. Then, last year, bitcoin was mentioned in a ruling by the U.S. Supreme Court in light of the need of a “broader understanding” of what money is nowadays.

In Europe, at least for the moment, the treatment of cryptocurrencies for regulatory and tax purposes has largely been determined by a decision of the European Court of Justice. In October 2015, ECJ stated that bitcoin represents a means of payment and its exchange should therefore be exempted from VAT. According to the ruling in the Skatteverket v Hedqvist Case C-264/14, the exchange of bitcoin falls within the exemption in Article 135(1)(e) of EU’s VAT Directive, which covers transactions concerning currency, bank notes, and coins used as legal tender.

Why Portugal’s Tax-Free Crypto Trading Matters for Bitcoin

David Hedqvist is a Swedish national who planned to launch a crypto exchange platform that would profit from the margin between bid and ask prices. He sought clarity regarding the VAT treatment of this kind of revenue and received an opinion from the Swedish Revenue Law Commission (Skatterättsnämnden) stating that the services he intended to provide would be exempt from VAT under Article 135. However, the Swedish Tax Administration (Skatteverket) disagreed and appealed the matter to the country’s Supreme Administrative Court, which in turn referred the case to the ECJ.

The other category of taxes that can be applied to crypto-related income includes direct taxes. One of the most common of them, the corporate tax, is generally imposed on the income or capital of business entities, and companies working in the crypto industry are no exception. In most cases the tax is levied on a corporation’s net profits, but governments may also tax shareholders if they are paid dividends.

Investments in cryptocurrencies can be subject to capital gains tax. These gains are usually realized from the sale of stocks, bonds, precious metals like gold, antiques, real estate, and property. In some jurisdictions, crypto assets are part of that list as well. The capital gains tax, where it’s imposed, can come in different rates for individuals and corporations. Certain countries may charge only professional traders.

Germany is another interesting example in Europe. The Bundesrepublik does not tax long-term investments in cryptocurrency. If a private trader sells their bitcoin more than a year after its purchase, the profit is exempt from capital gains tax. The same applies to annual profits of less than €600. That means keeping digital coins in Germany will actually save you money. And regardless of how much profit you make when you sell the cryptocurrency after hodling for over a year, you don’t owe the state any tax on your gains.

Why Portugal’s Tax-Free Crypto Trading Matters for Bitcoin

Significance for Traders

Portugal’s decision not to tax direct gains on the appreciation or sale of cryptocurrency and ECJ’s ruling that VAT is not applicable to exchange transactions have considerable significance for traders. And it’s not only because crypto users are spared some taxes. Both actually tip the scales in favor of Bitcoin’s currency status in times when lawmakers and regulators are trying to wrap their heads around a phenomenon born as a result of financial evolution. With many analysts now pointing towards the next big crisis on the horizon, the importance of cryptocurrencies is likely to grow further, with more investors, traders, and ordinary users attracted to the space.

If you are looking to securely acquire bitcoin cash (BCH) and other leading cryptocurrencies, you can do that with a credit card at buy.Bitcoin.com. You can also freely trade your digital coins using our noncustodial, peer-to-peer trading platform. The local.Bitcoin.com marketplace already has thousands of users from around the world and is growing fast. Also, check out our newly launched premier trading platform exchange.Bitcoin.com. Registered users can access it right now and over 10,000 have signed up already.

Do you expect cryptocurrencies to eventually gain full recognition as currencies from authorities and regulators? Tell us what you think on this subject in the comments section below.


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Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Bulgaria, which sometimes finds itself at the forefront of advances it cannot easily afford. Quoting Hitchens, he says: ”Being a writer is what I am, rather than what I do.“ International politics and economics are two other sources of inspiration.

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Corporate Tax Software Market 2019 Detailed Analysis and Huge Growth by Top Players …

Global Corporate Tax Software Market 2019 is expected to demonstrate an enormous growth in the upcoming years. The analysts also have analyzed …

Global Corporate Tax Software Market 2019 is expected to demonstrate an enormous growth in the upcoming years. The analysts also have analyzed drawbacks with on-going Corporate Tax Software trends and the opportunities which are devoting to the increased growth of the market. International Corporate Tax Software market research report provides the perspective of this competitive landscape of worldwide markets. The report offers particulars that originated from the analysis of the focused market. Also, it targets innovative, trends, shares and cost by Corporate Tax Software industry experts to maintain a consistent investigation.

The Corporate Tax Software report presents an estimation of the forecast from 2019 to 2025 and market history from 2014 to 2018. The information provided in the form of earnings likely to be produced in (USD million) year to year by Corporate Tax Software growth rate (CAGR). The report explains market segmentation based upon the types in addition to the leading regions featuring ‘North America, Asia-Pacific, UK, Europe, Central & South America, Middle East & Africa.’

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Prime Players:

Bloomberg Tax Fixed Assets, Avalara, Credit Karma, Corptax, TurboTax Business, Vertex, TaxJar, inDinero, H&R Block

Market Segment by Types, covers:

  • Web Based
  • Cloud Based

Market Segment by Applications can be divided into:

  • SMEs
  • Large Enterprises

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Key questions include:

  1. What will the growth rate and also the global Corporate Tax Software industry size by 2025?
  2. What will be the elements driving the Corporate Tax Software market?
  3. What will be the global Corporate Tax Software market trends affecting the growth?
  4. What would be the Corporate Tax Software challenges for development?
  5. Who are the profitable vendors of the market?
  6. Which would be Corporate Tax Software industry opportunities and dangers faced with most vendors in the industry?
  7. What are the variables affecting the Corporate Tax Software market share of APAC, the Americas, Europe, along with MEA?
  8. What will be the outcomes of this market SWOT five forces analysis?

Objectives of Information Mining

  • Providing demographics and data;
  • Providing Corporate Tax Software instructions;
  • Researching global Corporate Tax Software market dynamics, expansion drivers, along with business restraints;
  • Providing Scope and definition of the market;

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Customization of this Report: This Corporate Tax Software report could be customized to the customer’s requirements. Please contact our sales professional (sales@globalinforeports.com), we will ensure you obtain the report which works for your needs.