Internet company Spot.IM is awaiting permission from conservative Israeli regulators to officially pay salaries in Bitcoin.
The management of the Israeli Internet company Spot.IM offered its employees a choice between fiat and digital salaries.
According to Spot.IM representative Itay Brach, the company is now trying to obtain permission from local tax authorities for this. On the one hand, Israeli legislation does not officially recognize Bitcoin as a currency, but considers it financial assets. On the other hand, tax rules allow payment in cash equivalent, so cryptocurrency, according to the company's lawyers, can be a form of payment, like any other cash equivalent, and be considered by the tax authority as taxable income. Thus, when receiving a salary in cryptocurrency, employees will be required to pay a tax rate of 25% (the so-called capital gains tax).
However, Spot.IM employees supported the innovation, especially after the company’s willingness to bear the costs of converting funds. The company plans to open an account on a crypto exchange, through which funds will be converted into bitcoins and distributed to individual digital accounts of employees. Personnel will be able to dispose of the amount at their discretion, receiving payment in fiat in whole or in part in the BTC. Taxes levied on salaries in Israel and contributions to the pension fund will not go through the crypto platform. To avoid the negative impact of Bitcoin's high volatility on employee earnings, payouts will be calculated based on the daily average of BTC on the specified day.
Spot.IM CEO Ido Goldberg hopes to receive such approval soon and believes that such initiatives are needed in the crypto space to increase trust in digital currencies in society. The company, with 50 employees in Tel Aviv and New York, actively supports innovative technologies. The successful Israeli startup, which has raised $25 million, offers technology to turn any website into a social network and partners with 70% of premium US publishers.
The company hopes to receive a positive response from the Israeli tax authorities, despite the cold attitude towards crypto assets in the country tight control crypto market.
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