Article: Article 9 (27) (d)
Subject: Exemptions - Cryptocurrency pay is subject to provision of services
VAT, but exempt.
Case: No. 14436, by order of 2019-07-03, of the Director of VAT Services, (by
Content: With reference to the present request for binding information requested by
under Article 68 of the General Tax Law (LGT), it should be stated:
I - Order
1. The Applicant intends to make an investment for the creation of
cryptocurrency. With a view to your decision making you want the clarification
accounting and tax framework of the business creation activity
2. The Applicant clarifies that the creation of cryptocurrency is usually
designated mining. Mining requires processors
(computers) for the handling and organization of transactions carried out or
posted on the internet. The information related to these transactions is
compiled as "blocks". The accumulation of information in the form
"blocks" gives rise to the blockchain, which acts as a logbook
of the transactions performed.
3. The organization of the transactions referred to in "block" forms and their
blockchain sign-up guarantees "pay" through cryptocurrency,
created specifically for this purpose. Cryptocurrency can be exchanged for
"real" currency according to its market value and may be used as a
means of payment from vendors that accept the cryptocurrency.
4. Revenues of the entity that carries out the "mining activity"
result from cryptocurrency compensation for the organization of transactions
in the form of "blocks" and exchanging this cryptocurrency for "real"
5. According to the Applicant, the activity identified above is not performed
to anyone in particular. The main expenses of the "mining activity"
from the initial investment required in computer equipment,
energy consumption for the operation and cooling of processors
and the lease / acquisition of the space required for the placement of
6. The Applicant intends to clarify the accounting framework and
VAT, of "mining activity".
7. The Applicant states that there are two recipes with "mining", the exchange
cryptocurrency by "real" currency and the miner's remuneration in
8. In the first case, the Applicant considers that we are facing an exemption
VAT pursuant to Article 9 (27) (d) of the VAT Code.
Case No. 14436 2
9. In the second case, the Applicant raises a number of doubts: whether the
remuneration in cryptocurrency constitutes a provision of services on behalf of
VAT; considering a provision of services, what type of service should be
considered for localization purposes; who is considered the
acquirer of this service and what is the taxable amount of the operation.
II - Background
10. Article 9 (27) (d) of the CIVA is based on Article 135.
paragraph 1 (e) of Council Directive 2006/112 / EC of 28 November
2006 (VAT Directive), according to which Member States exempt from tax
"(a) transactions, including trading, in respect of currencies, currency and
currency of liberatory value, except coins and collection notes,
gold, silver or other metal coins, and
banknotes which are not normally used for their liberatory value or which
have a numismatic interest. "
11. The national rule provides that they are exempt from VAT.
dealing in foreign currency, banknotes and
coins, which are normally used as such, or which have been
numismatic interest. "
12. As regards the provisions of Article 135 (1) (e) of the VAT Directive, the
Court of Justice of the European Union (CJEU), in its judgment in Case
delivered on 22 October 2015 in Case C-264/14, in which it
At issue was a dispute between the Skatteverker (Swedish Tax Administration)
and David Hedqvist, on the basis of a prior opinion given by the Commission of
Tax Law (Skatterättsnämnden) on the subjection of value added tax to
of traditional currency exchange operations by the currency
bitcoin, or vice versa, which David Hedqvist intended to carry out by
through a society.
13. In the abovementioned case, the ECJ stated that:
1) Article 2 (1) (c) of Council Directive 2006/112 / EC of 28
November 2006 concerning the common system of value added tax
should be interpreted as constituting benefits
services for consideration within the meaning of that provision, transactions,
such as those at issue in the main proceedings, which consist of the exchange
traditional currency units per bitcoin virtual currency, and vice versa,
an amount corresponding to the margin
difference between, on the one hand, the price at which the operator concerned
concerned buys the currency and, on the other, the price at which it sells it to its
2) Article 135 (1) (e) of Directive 2006/112 should be interpreted as
provision of services such as those at issue in the proceedings
principal, which consist of the exchange of traditional currencies by units of the
bitcoin, and vice versa, on payment of a
corresponding to the margin consisting of the difference between, for a
on the one hand, the price at which the trader in question buys the currency and, on
price at which it sells them to its customers are transactions exempt from
value added tax within the meaning of that provision.
Case #: 14436 3
14. In the present case, the CJEU considered bitcoin as a means of
payment method used in a manner analogous to the means of payment with
consequently, these transactions as subject to VAT are still subject to
which exempt him.
15. Having regard to the decision of the CJEU in the abovementioned case, the
exchange of cryptocurrency for "real" currency constitutes a provision of
for consideration, exempt from VAT pursuant to point (d) of
27) of Article 9 of the CIVA.
16. With regard to remuneration on cryptocurrency, this being "currency"
a means of contractual payment, we recall the text of the next judgment
referred to in this information. Regarding the possibility of applying the
Article 135 (1) (e) of the VAT Directive only to transactions concerning
traditional currency or, on the contrary, also covers
other currencies, it is stated that "(…) the exemptions provided for in Article 135,
(1) (e) of the VAT Directive are intended in particular to alleviate the
difficulties in determining the taxable amount and the amount of VAT
deductible, which arise in the context of financial transactions. However, the operations
relating to non-traditional currencies, ie several of the currencies with a
in one or more countries constitute financial transactions provided that
these currencies have been accepted by the parties to a transaction as a means of
alternative payment to the means of liberatory value and have no other
purpose other than as a means of payment. (…) It is therefore clear from the context
and purpose of Article 135 (1) (e), that an interpretation of the
that provision concerns only operations
relating to traditional currencies would amount to depriving that provision of a
part of its effects. "
17. Accordingly, adhering to the arguments used by the ECJ, it is considered that
whereas cryptocurrency remuneration is a service subject to VAT
whereas Article 9 (27) (d) of the CIVA covers not only the
operations relating to the traditional currency, but also operations relating to the
18. With regard to the location of operations, and since the form of
as the question is raised does not allow the individual transactions to be
we refer to the clarifications provided in Circulars no.
30164 of 12/11/2014, from the VAT Tax Management Area - Office of the
Deputy Director-General and 30165 of 12/26/2014 of the VAT Services Directorate
are available for consultation on the Finance Portal.
19. With regard to accounting framework issues, the following
are outside the scope of the Tax Management Area