foreign
[Music]
hi everyone I'm here to remind you that
even though uh crypto isn't in no type
of crypto is currently a form of money
in Colombia that doesn't mean you don't
have to pay taxes on it
um that's a joke
um yeah no but even even you know
because of this we want to make sure
that the rules for paying taxes on
crypto and crypto related activities are
are clear uh we're taking steps to make
that uh make make things even clearer
than they currently are uh a few of you
may have wondered especially if you
um even if you have just uh used a
crypto platform if you are if you have
to pay any taxes on the gains that you
make from your Investments or if you run
a platform I don't know if the
representatives of the the exchanges uh
in the country are are here uh we would
like to make sure that you know exactly
what rules you have to to follow briefly
speaking even though crypto is no it's
not legal tender in Colombia uh it is
considered for tax purposes uh and
intangible asset which uh which
basically follows the the the treatment
that other jurisdictions give to to
crypto and in general to many digital
assets in Colombia you have to
um you know you you have to uh fill out
a tax return as just uh uh you know a
natural uh person you uh you have to
declare uh your net worth which is uh a
very particular thing to the Colombian
tax system uh many of you guys probably
have heard the debate in Congress about
a taxation of your net worth how it's
calculated uh and so just you know just
like if you're curious about this you
you would basically have to to tell uh
us to tell the tax administration the
value of the crypto at the the passive
value that you acquired it on on the day
when you acquired it you just have to
tell us there's currently no taxes on on
your net worth uh there have been in the
past but this is only for informational
purposes and everything else is
essentially a capital gains taxation if
you so if you if you buy crypto or other
assets right uh if you buy nnft and it
increases in value you don't have to pay
any taxes until the moment when you sell
it so if you sell it you make money on
it the difference between the price
which you bought it and the price that
that you bought for it uh is the uh is
the basis on which you have to pay a
rate that rate will depend on whether
you have held the the assets for uh two
years uh or or more if you have held
them for more than two years this is the
roughly speaking the capital gains tax
it's called Uh ganancies in in Colombia
um it's currently a 10 tax rate if the
tax reform bill that we're working on
goes through it will be at 15 of the the
appreciation
uh if you sell the asset before two
years then you just have to pay the the
ordinary rate which is a progressive uh
taxation scheme it starts at 19 uh at
very high levels of income it goes all
the way up to
uh 39 uh which is much like what you
would pay in in the United States for uh
ordinary income as well you may have
wondered uh I know because I have uh if
uh if you're in an exchange and you buy
and sell crypto right maybe you're just
playing around with uh uh any type of
cryptocurrency you've made uh and you
sell it to someone right and if you if
you like to think about tax issues which
some people do you may Wonder does this
pay vat though the value-added tax uh
Eva in Spanish there are activities such
as exchanges that are that do not pay uh
vat uh it so when it comes to intangible
assets uh like uh like crypto then
as long as they don't have uh an
intellectual commercial industrial value
so this is more like patents right like
if they don't have that that added value
then you're not responsible for paying
vat uh however if you're selling say
uh at least some sort of of nfts there
may be vat to be be paid so especially
if you're thinking of running a business
that operates buying and selling uh
crypto nfts other types of uh digital
assets these are things that you may
want to take into account and we want to
make this easy for those paying taxes
right you have to pay them the least we
can do is make it easy for you so uh we
are here to to help uh I have uh I've
given instructions to uh the the the the
subdirectorate in charge of uh Norms you
know interpreting the the tax norms for
specific cases in specific Industries to
compile all the concepts we have we have
issued about crypto in a single document
and uh but also we are here to collect
the questions that you may have and we
want to issue an official concept about
this we want to do this both in Spanish
and in English we want to have a clear
rules for those coming from abroad to to
invest and even though uh I think we're
all excited for the uh for the closing
event at 3 30. uh we are here to to take
questions uh uh yeah sure so you're
mentioning that we would have to pay
taxes if I you know purchase a Bitcoin
let's say it goes up in price and then
sell it for fiat currency but if I were
to buy a Bitcoin and then swap it to
another currency another digital
currency let's say ethereum and the
price was well technically created a
taxable game how would I pay that tax
would I pay it in the value of the local
fiat currency would I pay it in one or
the other intangible ads assets how how
would you do that that's a great
question
um because currently uh ether and then
at Bitcoin are not currently considered
uh currency in Colombia uh and you're
just swapping assets
um uh it may depend but you would
probably just have to pay uh the time
you sold the uh in your example the
ethereum for Fiat
um and then I think that also raises the
question of what do you do if you uh if
you buy something in crypto right like
if you if you buy a house in crypto like
what would you do how does it work uh
and then in in that case you would have
to take into account the the value at
which uh that that house uh is fairly
valued and the value of uh of your asset
and then that difference would be the
basis for for taxation
so you never specified whether for
whether it was first in first out which
is if I had bought Bitcoin and maybe I
put it off to the side for long-term
storage or ethereum whichever asset and
then later I start trading with other
assets over here so first in first out
would say that the very first purchase
of the asset ethereum let's say was at a
hundred dollars and now it's at fifteen
hundred dollars it doesn't matter my
trades over here it's first in first out
do you understand the first stand person
right right yeah so you never specified
whether there's a first and first out
rule that you have or not I think the
what's really helpful for uh for
thinking all this is that for all
practical effects and purposes in
Colombia uh crypto assets are intangible
assets so you would handle uh say
inventories uh in the same you would
follow the the current accounting rules
right
um uh in in Colombia this uh I don't
know what uh accounting rules you're
most familiar with but we wouldn't be
using a US U.S gaap but we would be
using IFRS rules for for accounting uh
so so that's what would apply it would
apply in in this case uh I I I think uh
we probably in the concept and in the
document that uh we will uh post uh I
will post it on on my Twitter account uh
uh to to start clarifying some of those
things but mostly to invite questions
like this so that we can we can give you
specific detailed answers
um yeah what about the crypto you gain
like paying on services so for example I
have a income right on crypto how should
we tax that yeah uh currently we so uh
you you can be paid in
in in and things other than Fiat in in
Colombia and that's uh that's already
regulated right you could be paid uh uh
so some people are paid in uh or at
least partly in education for their
children right like their uh their firm
pays their children's tuition or they
give them uh access to uh country clubs
uh which have a certain value and all
those payments in basically and stuff uh
the same rules uh as for payments and
income and then and excuse me and Fiat
apply so you would basically have to uh
tell the the government what the
uh so what's the the fair uh Market Fiat
value of the crypto and that would be
the the basis of the tax you pay
but you would pay exactly the same as if
you were paying um
as if you were paying uh if you were
being paid in uh in in Fiat
so suppose yeah suppose you
um so so you work for a company that's
paying you in in crypto then
um they pay you uh in the Italian
government this is how many pesos this
was worth then you pay taxes on the
basis of that but then your crypto
continues to gain in value
um if you if you sell it to buy
something something else then at the
moment of selling it you would pay uh an
additional tax on on those capital gains
basically yeah and if you you know if
you found someone who was willing to to
sell you stuff directly uh for for
crypto then uh this this follows the
same There are rules and regulations in
Colombia that apply to uh exchanges of
stuff right like if you if you trade uh
I don't know if you trade uh a house for
uh five cars which is something that
people sometimes do you would you would
apply the same rules in the tax code
some wallets have uh debit cards if
you're given by Visa or Mastercard so
how do you make a chain of taxes
whenever you have a wallet that lets you
save in usdc or whatever and then spend
it in retail let's say in a cafe I think
there will be taxes along the way but
who is paying what in that change
so um I'm sorry the question is you have
uh uh I don't have one just okay okay
yeah hypothetically there is a wallet
with debit cards so how do they pay
taxes along the way when you have debit
cards uh the payment processors and
there is a crypto wallet involved
right
um yeah currently uh none of that so uh
those are things that would have to be
regulated by the uh by the financial
Authority uh the the Colombian SEC the
superintendency of financiera
uh because uh the regulation is still to
come uh you would basically not pay a
lot of things that you pay in the
current Financial system there's uh you
may be aware that that in Colombia
there's the cuatro per meal which is
like a 0.4 percent tax on financial
transactions uh that would apply only
when you convert that into uh uh you
know into into VR and into uh the
traditional Financial system uh but
that's that's a great idea to raise her
anyway I'll take that one with me
um yeah
I'm just kidding uh but not entirely
yeah what's your position about using
any cryptocurrency as a collateral to
have a pesos or use dollars
as a collateral uh like for uh getting a
loan or yes exactly yeah uh this is uh
this is uh still something that has to
be regulated by the financial Authority
uh so uh uh I suppose you could sign a
private contract uh and then you give
this as a collateral as long as someone
else accepts it uh you you could sign
you could sign a contract that that
specifies it right yeah right okay so in
the case of uh of D5 yeah uh we're
actually this is one of the questions
that that we currently want to to
address in detail uh because it's it's a
question that we've been uh yeah we're
being asked a lot so so we're working on
on issues related to to D5 for sure your
offer your office published a document
like four months ago the former director
regarding this uh taxi song crypto that
that document is still running we have
to apply that it's it's still in force
uh there were roughly 25
documents that we had published
answering various questions so what
we're doing is we're compiling all of
them in a single document so that uh you
have everything in One Source but
nothing has has changed we just want to
make this more accessible and like I
said uh some of these you know these
questions and more if you guys want to
uh you know talk to to the the to uh uh
lawyers from from Beyond that that came
here uh with me
um we will make sure to address them we
want to give the to have a comprehensive
treatment of of how to handle these tax
issues to to give you know to give
everyone more more certainty and
instability and and hopefully not have
to pay like very expensive Consultants
when we can do it for free for you the
context of of my question is because the
the former director yeah said in
incarnate called noticias that people
that is that need to declare their
crypto they have to do it from 2017 and
they have to pay the maltas from those
years 17 18 19 20. and what do you think
about that because the incentives are
maybe not aligned and people don't want
to declare something to be a bad person
and paying those multas you know
right um as part of the uh the the tax
reform bill that uh we are
um you know uh uh shepherding through
Congress we are
trying to make a lot of those fines uh
not just for crypto specifically but for
a lot of uh different businesses and and
also just regular people a lot more
understanding of when people are not
really at fault and we want to focus on
actual tax evaders uh the process is
still ongoing so uh as I said we we
welcome
all feedback that that you may have
about the permissions that we have
already included in the bill and what
else could be could be useful one thing
that uh we uh we have gotten a lot of
questions about has to do with whether
we will accept taxes uh in crypto uh
it's it's something that we as of as a
tax administration can can do if given
legal Authority by Congress we can we
can handle it we think it's actually
very interesting if uh you know if a
firm or if a person wants to be
associated with a specific wallet or
sets of wallets because that actually as
you guys know a lot of people still
think that that crypto is cryptic and
that you can't trace stuff we're
actually interested in the traceability
of a lot of uh of the cryptocurrencies
and that it that can only be uh good for
us as a tax administration so we're very
open to all of these proposals uh talk
to your Congressman or congresswoman
there's still time to introduce some
Provisions here uh the first one is
we've talked about a lot of taxes right
but what's your truly Vision about
crypto like uh would you would you be
considered as a pro crypto person or
what are you are you at the tractor
um that's one and the other one which
more question that I always ask do you
hold any crypto
do I what do you hold any crypto I've
I've held it yes yeah oh no for sure I
um I mean look I think it's a technology
that's here to stay uh I think it's
promising I think the I think there's a
lot of misconceptions about crypto I
think we should help everyone understand
that this is a promising technology I I
look forward to the forthcoming
regulation that various other government
agencies or which I have no control I
should say that uh will will issue at
some point I think it should be sooner
rather than later I think there's uh one
of the developments that that I find
most exciting is uh uh Central Bank
issued you know digital currencies I uh
I I was excited like I suppose many of
you were when the Central Bank announced
that they are studying the the issue I
think uh I think I think only good
things can come from uh from from this
industry
okay I have another question so it's
more about stable coins and usdt usdc so
if I get my pesos and always convert
them into US dollars or well in this
case usdc or usdt and then I when I need
the money back in Colombia I transfer
them back to my account what would be
that tax incentive like implications
there because you said like it's like
buying dollars you know Cambio and then
just like either spending in abroad or
just having them in your house or
whatever so what would be the
implications there
yeah so uh something like like usdt or
uh other stable currencies uh stable
coins are they are not legal tender uh
here or anywhere so they are uh under
Colombian legislation and and then rules
uh they are considered uh just
intangible assets so the way it would
work is say you so suppose you you buy I
don't know you uh like you go through a
whole process right you deposit some
Pesos into a local platform you use it
to buy uh Bitcoin which then you in a
local platform which then you transfer
to a platform abroad and you use it
there to buy some usdt and then you do
some more stuff with it and then you
bring it back the way it would work in
terms of uh of it being taxed is you
there's a certain amount of in pesos
that you paid uh at the the exchange
rate the official exchange rate of that
they uh
um and then when you transform it back
into Pesos at the very end it's the
difference between the pesos you got at
the very end and the passive value of
the original asset that's that would be
the the the capital gains so to speak uh
you've stated your position very clearly
about the the crypto coins and all these
coins that are native natively digital
but there are also other type of tokens
that represent for example real life
assets such as houses and other kind of
things uh is your take the same for
those types of assets that have a real
asset like as an underbuying value an
underlying value I'm sorry in real life
but they're just represented digitally I
like the technology uh look I just run
the tax administration like those are
issues for the uh for for various
government entities right like uh I
think it's exciting to uh to see how uh
you know ownership Registries uh would
work uh how the financial regulation
really is what uh as we all know uh is
necessary for uh for this industry to to
have a more solid footing uh I and I do
hope and I know that that the people
involved in this uh understand the the
issue and they're working towards uh
making things like that possible uh I
think I think in general it's an
exciting technology and I I also think
that uh we we still we're still trying
to figure out all the possible ways in
which uh the technology can be used
so I I'm sure there's more to come and
then those are good examples of what we
could see oh the taxation okay so when
you have underlying assets
um well
um in in in that case
yeah basically
the difference between the peso price
when you invested in the peso price when
you finally sold it that's that's what
will be taxed and it will be taxed as uh
uh either capital gains or ordinary
income
[Music]
meaningless
you mentioned the cvdc and there is a
incentive for the tax authority to look
everything that the citizens do for tax
purposes in in that sense what do you
think what is your position about the
privacy of of the citizens what is the
balance between knowing and taxing what
they do and knowing a lot more that
would you need to to know I think that's
uh that's a question for uh for
Colombian Society to answer as a whole
uh
I'm going to be perform honest uh from
the point of view of the tax
administration we're interested in in
the traceability of transactions
especially given that the Colombian
economy uh is so informal and so many
people use cash I think for instance uh
uh we you know if we could if we could
offer uh people a digital currency that
is more convenient than cash even safer
than cash right like if you're like if
someone steals cash from you there's no
way of getting it back if it's if it's
highly traceable you you may be able to
know what happened to it afterwards
right uh so those I think I think there
are trade-offs in life uh and and I
think it would be particularly
interesting for everyone involved to
have
a digital currency that is not 100
Anonymous that can be traced but that
also offers extra safety beyond the the
safety that that cash can give you
yeah I think my time is up and uh we
probably want to go out there but uh
thank you for your questions
um uh Alfredo and uh Stefania are here
to take to collect some more of those if
you uh and uh yeah we will be collecting
them and Publishing an official document
uh answering them so make sure to ask
absolutely everything that you want to
ask and this is not the only
yeah like
um they will be happy to share uh
contact information with you so that we
can maybe set up a round table between
Dion and the industry and and start
clarifying some of these questions thank
you very much
[Applause]