The Australian Taxation Office’s decision to define cryptocurrency Bitcoin as a commodity has had a fatal ripple-on effect for some small businesses.
The introduction of a 10 per cent GST charge made co-founder Daniel Alexiuc’s start-up unviable. “If I was to continue running the service, I’d be liable for a huge tax bill,” Mr Alexiuc said. “Or I’d have to charge 10 per cent extra to my customers, which just isn’t going to work.” Living Room of Satoshi allowed those holding Bitcoin to pay any BPay bills through the website, free of charge and without requiring a login. The business had been growing steadily and was processing around $20,000 worth of bills a week before the decision. Mr Alexiuc said the business is only paused for now and he is seeking legal advice on how to navigate the ruling. “Fundamentally, for Bitcoin to be successful in Australia it’s got to be used by business and at the moment it just cannot be,” he said.