The small Swiss town of Chiasso located at the border of Italy is the first in the world to accept Bitcoin for tax payments.
The town will start accepting up to 265 worth of bitcoin for tax payments starting January 2018. According to the announcement, the town intends to attract start-ups and innovative companies and this means there is a need to adopt modern day technology. In the last 8 months, 8 start-ups have chosen Chiasso to carry out their business and further negotiations are under way with other realities from all over Europe.
Mayor Bruno Arrigoni stated that the municipality is evaluating the possibility of participating as a founding partner in the formation of a non-profit foundation, which will involve some of the top experts of Chiasso’s Blockchain/Bitcoin technology.
“The council will regularly host meet ups on this topic, which will be attended by international representatives from October 2017,” the announcement stated.
This is the first time any governing authority is to accept tax payments in digital currencies. It follows CryptoValley’s Zug announcement they were to accept bitcoin in payments for local services, which apparently has been a success.
40 such payments have been made since, exceeding their expectations and further strengthening the valley’s claim to being business friendly towards blockchain companies.
“Chiasso is recognised internationally as an epicentre of a growing technological and economic growth for both the canton and in Switzerland,” the Mayor said.
It’s unclear whether the local authority will actually keep whatever bitcoin it receives or whether it will convert it into fiat. Bitcoin’s high volatility might make any decision to hold them risky, but that volatility has tended to be upwards in a longer time-frame since bitcoin’s invention. Whether that trajectory will continue in the future remains to be seen, but the currency asset can act as a hedge, especially if Francs fall in value against the Euro.
The move, however, is probably more symbolic than actually practical, although, who knows, they may actually want the bitcoins. But it is probable they are trying to signal friendliness to this space as Switzerland begins to position itself as far as digital currencies are concerned.