AUSTRALIA MOVES TO REMOVE DOUBLE TAXATION ON DIGITAL CURRENCY

Last updated: June 19, 2025, 22:57 | Written by: Katie Haun

Imagine buying a coffee with Bitcoin, only to be taxed twice on the same transaction.That's the reality Australian cryptocurrency users have faced for years. Digital currencies such as Bitcoin and Ethereum will no longer be subject to double taxation if legislation introduced last week into the Federal Parliament is successful. Treasurer Scott Morrison says the proposed change will further cement Australia s reputation as a global Fintech centre .But the wait is finally over!After much anticipation and advocacy from the FinTech sector, the Australian government has taken decisive action to eliminate the dreaded double taxation on digital currencies.This landmark decision, spearheaded by Treasurer Scott Morrison, is poised to revolutionize the way Australians interact with digital assets, potentially transforming the country into a global FinTech powerhouse. The Australian Treasury has recently introduced the Treasury Laws Amendment (2025 Measures No. 6) Bill 2025, which alters the GST treatment of digital currency. In an effort to promote more international commerce business in Australia, the proposed bill removes the GST obligations from digital currency effectively putting such currency on even footing with any other physical currency inThe passage of the Treasury Laws Amendment (2025 Measures No. 6) Bill 2025 signifies a major shift in Australia's approach to cryptocurrency regulation, aligning the Goods and Services Tax (GST) treatment of digital currency with traditional money.This move will eliminate GST on digital currency purchases, leveling the playing field and fostering innovation in the burgeoning digital economy.This legislation will allow Australia to compete with other countries and to attract innovative blockchain companies. Transactions in digital currency will no longer give rise to double taxation in the hands of consumers from, as a result of legislative amendments that were recently enacted. The amendments align the Goods and Services Tax (GST) treatment of digital currency with money. ThisThe backdating of the legislation means the impact will be felt immediately. Digital currency should be treated as money : The committee recommended treating digital currency as money for the purposes of the goods and services tax. It recommends that the government consults with the states and territories to consider amending the definition of money in the A New Tax System (Goods and Services Tax) Act 2025 and including digital currency in the definition of financialThis article will explore the implications of this game-changing legislation, its impact on consumers and businesses, and what it means for the future of cryptocurrency in Australia.

Understanding the Double Taxation Issue

Before celebrating the victory, it's crucial to understand the problem that has been plaguing the Australian crypto community: double taxation.Under previous Australian laws, cryptocurrencies like Bitcoin and Ethereum were subject to Goods and Services Tax (GST) at two different points.

Initial Purchase: When an Australian citizen purchased digital currency, they were charged GST on the purchase price.This means the consumer paid GST when acquiring the digital asset.
Subsequent Transaction: When the same digital currency was used to buy goods or services, another GST was levied on the transaction.This effectively meant the same digital asset was taxed twice.

This double taxation was seen as a major obstacle to the adoption and use of cryptocurrencies in Australia, stifling innovation and hindering the growth of the digital economy. By Matthew Cridland. Treasurer Scott Morrison has introduced legislation into the Australian Parliament to remove the double taxation of digital currency. The Bill will ensure that Australians are no longer charged GST on purchases of digital currency, allowing it to be treated the same way as physical money for GST purposes.The existing tax laws created an unfair playing field, discouraging Australians from using digital currencies for everyday transactions.

Imagine a simple scenario: You buy $100 worth of Bitcoin, paying $10 in GST.Then, you use that Bitcoin to buy a $90 item, and another $9 in GST is charged.You end up paying $19 in GST on a $90 purchase. Australian government to remove double taxation of bitcoin RegulationThis is the absurd reality the new legislation aims to address.

The Treasury Laws Amendment (2025 Measures No. 6) Bill 2025

The Australian government has responded to the crypto community's outcry by introducing the Treasury Laws Amendment (2025 Measures No. 6) Bill 2025. Treasurer Scott Morrison has introduced legislation into the Australian Parliament to remove the double taxation of digital currency.This pivotal piece of legislation directly addresses the double taxation issue by amending the GST treatment of digital currency.

Here's a breakdown of the key aspects of the Bill:

GST Exemption: The core of the bill is to remove GST obligations on digital currency when used to purchase goods or services.
Alignment with Money: The bill aims to treat digital currency in a manner similar to traditional physical currency for GST purposes. Australian's federal government has announced plans to remove a 'double taxation' treatment that affects digital currencies such as bitcoin.This means that using Bitcoin to buy a coffee will be treated the same way as using Australian dollars.
Promotion of International Commerce: By removing the GST burden on digital currencies, the government aims to attract more international commerce and business to Australia.This will potentially increase foreign investment into Australia.

Essentially, the legislation seeks to level the playing field and create a more favorable environment for the use of digital currencies in Australia.It acknowledges the growing importance of digital assets and seeks to integrate them into the mainstream economy.The goal is to foster a welcoming environment for businesses to operate in Australia by removing hurdles such as double taxation.

Treasurer Scott Morrison's Vision for a FinTech Hub

Treasurer Scott Morrison has been a strong advocate for the removal of double taxation on digital currency.He views this legislation as a crucial step in solidifying Australia's position as a global FinTech hub.Morrison stated that the move will ""further cement Australia's reputation as a global FinTech center.""

Morrison's vision extends beyond simply removing a tax burden.He sees it as an opportunity to:

Attract Investment: By creating a favorable regulatory environment, Australia can attract investment from both domestic and international FinTech companies.
Foster Innovation: Clear and supportive regulations encourage innovation in the digital currency space, leading to new products, services, and business models.
Create Jobs: A thriving FinTech sector will create new jobs in areas such as software development, blockchain technology, and digital asset management.

The Treasurer believes that by embracing digital currencies and fostering a supportive regulatory environment, Australia can become a leader in the global FinTech revolution.This will encourage more young entrepreneurs to invest in building future technologies within the Australian FinTech sector.

Impact on Consumers and Businesses

The removal of double taxation on digital currency is expected to have a significant impact on both consumers and businesses in Australia. Treasurer Scott Morrison has introduced legislation into the Australian Parliament to remove the double taxation of digital currency. The Bill will ensure that Australians are no longer chargedThe benefits include:

For Consumers:

Reduced Transaction Costs: The most obvious benefit is the reduction in the overall cost of using digital currencies for purchases.
Increased Adoption: As the cost of using digital currency decreases, more consumers are likely to adopt and use it for everyday transactions.
Greater Choice: Consumers will have more options for payment, with digital currencies becoming a more viable alternative to traditional methods.

For Businesses:

Increased Competitiveness: Businesses that accept digital currencies will be more competitive, as they can offer lower prices to customers.
Access to New Markets: Accepting digital currencies can open businesses up to new markets, both domestically and internationally.
Reduced Administration: The simplification of GST rules for digital currency can reduce the administrative burden for businesses.

Businesses may find that they can lower their costs by embracing digital currencies as a mainstream payment option. The Australian Government has passed legislation crafted to remove the double taxation on cryptocurrencies. Industry participants welcomed the step as indicative of the maturing Fintech policyIt offers a modern alternative to other payment methods, leading to a competitive edge.

The Path to Implementation: A Timeline

The journey to remove double taxation on digital currency has been a long and winding one.Here's a timeline of the key events:

December 2025: The Australian Taxation Office (ATO) releases rulings providing clarity on the tax treatment of digital currencies.
October 19, 2025: The Australian Parliament passes legislation to remove the double taxation of digital currencies.
September 29, 2025: Legislation to implement Crowd Sourced Equity Funding (CSEF) for public companies also passed.
July 1, 2025: The legislation is enforced retroactively.

The legislation passed in Parliament on October 19, 2025, and will commence on September 29, 2025.This removes any doubt regarding the double taxation on cryptocurrency.The legislation means digital currency will be treated like money for tax purposes.

Industry Leaders Respond: A Welcome Development

The Australian fintech industry has overwhelmingly welcomed the government's decision to remove double taxation on digital currency. The Australian Government s passage of legislation to remove double taxation on digital currencies is a welcome step and signifies the growing maturity of Australia s fintech policyIndustry leaders view it as a sign of the growing maturity of Australia's fintech policy environment.

Here are some common sentiments expressed by industry leaders:

Positive Step: The removal of double taxation is seen as a positive step towards fostering innovation and growth in the digital currency space.
Level Playing Field: Industry leaders believe that the legislation will level the playing field between digital currencies and traditional money.
Global Competitiveness: The move will help Australia compete with other countries that have already embraced digital currencies.

Industry leaders are optimistic about the future of digital currencies in Australia and believe that the removal of double taxation will pave the way for greater adoption and innovation. On 19 October, the Australian Parliament passed legislation that will transform how digital currencies are treated for taxation purposes in Australia. The legislation, which means digital currencies used to buy goods and services in Australia will be treated just like money for tax purposes, will be backdated to .This will place Australia as a future fintech hub.

Addressing Common Questions about Cryptocurrency Taxation

The taxation of cryptocurrency is a complex and often confusing topic.Here are some common questions that taxpayers may have:

Q: What happens if I bought cryptocurrency before the law passed?

A: The legislation is being applied retroactively to July 1, 2025. New legislation passed by the Australian government will remove the double tax on digital currencies in a move that will propel Australia to the next Silicone Valley, industry leaders say.So any sales of cryptocurrency from July 1, 2025, are covered under the new legislation.

Q: Does this mean I don't have to pay any taxes on cryptocurrency anymore?

A: No, this does not eliminate all taxes on cryptocurrency. This refers to a series of rulings released in December 2025 by the Australian Taxation Office (ATO) which provided clarity to taxpayers on the income tax, fringe benefits tax and capital gainsYou may still be liable for capital gains tax if you sell your cryptocurrency for a profit.What is being removed is double taxation on digital currency.

Q: How do I report my cryptocurrency transactions to the ATO?

A: It is important to keep accurate records of all your cryptocurrency transactions, including the date, price, and purpose of each transaction. According to existing Australian laws and policies, all traders and investors of cryptocurrencies such as Bitcoin and Ethereum are potentially liable for the goods and services tax (GST). As such, digital currency users in Australia are again taxed for the GST that s charged on the currency used in the transaction. The double taxation for cryptocurrencies has received heaps of criticism fromYou will need to report these transactions to the ATO as part of your income tax return. What a great year for cryptocurrencies at least so far. First it was China that made moves to strengthen Bitcoin and then it was followed by Russia and now its Australia. The government in its budget summary for confirmed that it would treat the digital currency just like it treats moneyConsulting with a qualified tax advisor is recommended.

Q: What happens if I use cryptocurrency for business purposes?

A: The treatment of cryptocurrency for business purposes can be complex. The purpose of the legislative changes is to remove the double taxation of digital currency. The Australian government is looking for the best way to address the so-called double taxation of digital currency which is now prescribed by the Goods and Services Tax (GST) law. The push comes amid aIt is important to seek professional advice to ensure that you are complying with all relevant tax laws.

It is important to stay informed about the latest developments in cryptocurrency taxation and seek professional advice when needed. The Australian Government's passage of legislation to remove double taxation on digital currencies is a welcome step and signifies the growing maturity of Australias fintech policy environment, according to Australian fintech industry leaders. On 19 October, the Australian Parliament passedSeek counsel from a qualified tax advisor regarding cryptocurrency taxation and compliance.

Australia's FinTech Future: Beyond Double Taxation

While the removal of double taxation on digital currency is a significant step, it is just one piece of the puzzle in building a thriving FinTech ecosystem in Australia. The Australian government has finally and conclusively provided a legislative end to the double taxation of Bitcoin and other cryptocurrencies. The bill will retroactively be enforced to July 1 ofThe government is also taking other measures to promote innovation and growth in the sector, including:

Crowd Sourced Equity Funding (CSEF): Legislation has been passed to implement CSEF for public companies, making it easier for startups to raise capital.
Regulatory Sandboxes: The government is creating regulatory sandboxes where FinTech companies can test new products and services in a controlled environment.
Blockchain Initiatives: The government is exploring the potential of blockchain technology for various applications, such as supply chain management and digital identity.

These initiatives, combined with the removal of double taxation on digital currency, signal a strong commitment to fostering innovation and growth in the Australian FinTech sector.It shows that Australia is looking to compete on the global stage in the FinTech sector.

What's Next for Cryptocurrency Regulation?

The removal of double taxation is a welcome development, but the journey of cryptocurrency regulation in Australia is far from over.There are still many issues that need to be addressed, such as:

Clarity on ICOs: Initial Coin Offerings (ICOs) remain largely unregulated in Australia, creating uncertainty for both issuers and investors.
Regulation of Cryptocurrency Exchanges: Cryptocurrency exchanges are currently subject to limited regulation, raising concerns about investor protection and market integrity.
Integration with Existing Financial Regulations: Cryptocurrency needs to be integrated into existing financial regulations in a clear and consistent manner.

Addressing these issues will require ongoing dialogue between the government, industry, and the crypto community.Creating a clear and comprehensive regulatory framework is essential for fostering innovation and protecting consumers.

Conclusion: A New Era for Digital Currency in Australia

Australia's move to remove double taxation on digital currency marks a significant milestone in the evolution of the country's FinTech landscape.By aligning the GST treatment of digital currency with traditional money, the government has leveled the playing field and created a more favorable environment for innovation and growth. Digital currencies such as Bitcoin and Ethereum will no longer be subject to double taxation if legislation introduced last week into the Federal Parliament is successful. Treasurer Scott MorrisonThis will boost the Australian FinTech economy and encourage digital currency adoption.

Here are the key takeaways:

The double taxation of digital currency has been a major obstacle to its adoption in Australia.
The Treasury Laws Amendment (2025 Measures No. 6) Bill 2025 removes GST obligations on digital currency, effectively eliminating double taxation.
Treasurer Scott Morrison views this legislation as a crucial step in solidifying Australia's position as a global FinTech hub.
The removal of double taxation is expected to benefit both consumers and businesses by reducing transaction costs and increasing competitiveness.
While this is a significant step, ongoing dialogue and regulatory clarity are needed to address other challenges facing the cryptocurrency industry.

The future of digital currency in Australia looks bright. The removal of the double taxation on digital currency was among the steps announced in the budget to promote FinTech innovation and growth. Another step was legislation to implement Crowd Sourced Equity Funding (CSEF) for public companies. The Bill was passed in the Australian Parliament on, and will commence 29 SeptemberWith a supportive regulatory environment and a commitment to innovation, Australia is poised to become a leader in the global FinTech revolution.As a consumer, you can explore using digital currencies in your daily life. Now, the Australian government has at last introduced a bill to push the necessary legislation to remove the double taxation of digital currencies. A move described by Australia s treasurer Scott Morrison as an action that will further cement Australia s reputation as a global FinTech center . In a statement, Morrison wrote:If you are a business, you can consider implementing digital currency payment options.