A LAUNCESTON business owner is expecting more people to start using digital currency bitcoin following a Senate committee report recommending that it be reclassified.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
Launceston is home to two of about 10 bitcoin ATMs in Australia, and about 12 businesses accept it.
Bitcoin Association president Adam Poulton, who runs a Launceston-based business and owns the bitcoin ATMs, said on Wednesday he was already noticing increased transaction movements.
"The Senate has come out and said, 'You should treat it like money, and we don't tax other money so you shouldn't tax this money'," Mr Poulton said.
"Calling it money is a big step," he said.
The Senate economics committee recommended bitcoin be recognised as a regular currency for GST purposes, which goes against a decision by the Australian Taxation Office last year that classified it as an "intangible asset".
The ATO decision meant transactions were being stung with double GST, Mr Poulton said.
"Merchants didn't want to step into the arena because they didn't want to be hit with the tax bill at the end of the year, but this reverses that."
Mr Poulton said the recommendations would require only a small legislative change that would put Australia "on the forefront of bitcoin technology around the world".
"It gives consumers a bit of confidence."
He said bitcoin use in Launceston had been increasing fast, and up to 1000 Tasmanians now used it.
"I've heard of people travelling from Hobart to Launceston to use the ATMs," he said.
The Tasmanian and Victorian branch of the Uniting Church fears the currency will be used to pay for serious criminal activity, such as child pornography.
"It has been argued that bitcoin potentially allows any user - legitimate or criminal - to transfer money at near instantaneous speed at little or no cost, with very low barriers to entry, while remaining virtually anonymous without what could otherwise require a public paper trail," Uniting Church director Mark Zirnsak said in a submission.