The government of El Salvador has announced that foreign investors will be exempt from taxes on bitcoin profits. A government adviser disclosed the information on Sept 10, which is a development that further incentivizes entrepreneurs and investors to enter the nation. Speaking to AFP, Javier Argueta, legal adviser to El Salvador’s President Nayib Bukele, said, “If a person has assets in Bitcoin and makes high profits, there will be no tax. This (is done) obviously to encourage foreign investment.”
El Salvador is working with international agencies to implement compliance measures.
Argueta also revealed that the country was working with international agencies to implement compliance measures. Global financial regulators like the International Monetary Fund (IMF) have highlighted traceability and the prevention of illicit financial activities as key worries. Though still in its early days, the ratifying of bitcoin as legal tender is proving to be somewhat problematic for the country. There has been criticism from all sides, from the opposition party to global bodies across the world. But the government has not trudged on, undeterred by this resistance.
The Chivo wallet launched with $30 in BTC offered for first-time users.
The Chivo Wallet, which is El Salvador’s official bitcoin wallet, was launched on Sept 7, with $30 in BTC offered for first-time users. The government bought 400 bitcoins to prepare for the change, which has to be said isn’t going perfectly. It remains to be seen how the change will proceed in the medium and long term. Critics have listed a number of issues, with volatility being the number one concern. El Salvador’s internal ministers have drawn attention to this, saying that the volatility could affect salary payments.