In an essay published in London in 1976, Friedrich Von Hayek advo- cated a system of private, concurrent currencies . In that system, finan- cial institutions would compete for the use of their money to the advantage of the users in terms of lower inflation . The author however remained skeptical about the possibility of conceiving a supranational currency . Almost twenty years after its introduction, the European Union is experiencing ups and downs with the Euro, and many states are still struggling to comply with the imposed financial conditions . The rise of cryptocurrencies, operated via blockchain mechanisms, appears to be capable of removing the practical constraints that made Hayek’s theory impossible to implement . In order for currencies to compete, different tax rules are needed to level the playing field in taxation . This research goes beyond the identification of these gaps, as it proposes rules to address them . For instance, it proposes a domestic tax sus- pension for ICOs and a new inter-jurisdictional nexus, together with several scenarii . This research demonstrates that the conditions for a neutral, competitive environment are far from being met, at least in France and Italy, which are implementing distortive policies concerning private currencies for income tax purposes . For these reasons, it could be argued that the best solution would be, for instance, to address digital currencies and their issuance (through ICOs) with specific tax rules aimed at emphasising the role of the tax jurisdiction where they are issued for the first time, which is also the law of the State regulat- ing the exchange rate between the digital currency and the traditional one at the moment of the issuance.
Blockchains, Cryptos and Von Hayek’s Theory on Concurrent Currencies: Tax Implications in France and in Italy
Greggi M.Co-primo
;Cavalier G.
Co-primo
2021
Abstract
In an essay published in London in 1976, Friedrich Von Hayek advo- cated a system of private, concurrent currencies . In that system, finan- cial institutions would compete for the use of their money to the advantage of the users in terms of lower inflation . The author however remained skeptical about the possibility of conceiving a supranational currency . Almost twenty years after its introduction, the European Union is experiencing ups and downs with the Euro, and many states are still struggling to comply with the imposed financial conditions . The rise of cryptocurrencies, operated via blockchain mechanisms, appears to be capable of removing the practical constraints that made Hayek’s theory impossible to implement . In order for currencies to compete, different tax rules are needed to level the playing field in taxation . This research goes beyond the identification of these gaps, as it proposes rules to address them . For instance, it proposes a domestic tax sus- pension for ICOs and a new inter-jurisdictional nexus, together with several scenarii . This research demonstrates that the conditions for a neutral, competitive environment are far from being met, at least in France and Italy, which are implementing distortive policies concerning private currencies for income tax purposes . For these reasons, it could be argued that the best solution would be, for instance, to address digital currencies and their issuance (through ICOs) with specific tax rules aimed at emphasising the role of the tax jurisdiction where they are issued for the first time, which is also the law of the State regulat- ing the exchange rate between the digital currency and the traditional one at the moment of the issuance.I documenti in SFERA sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
