ECJ rules that virtual currencies are exempt from VAT

Based on a request of the Supreme Administrative Court of Sweden, the European Court of Justice has ruled that ‘the supply of services…which consist of the exchange of traditional currencies for units of the ‘bitcoin’ virtual currency and vice versa…are transactions exempt from VAT [Value Added Tax]’. The court’s reasons that purchasing and selling Bitcoin is similar to transactions of other ‘currency, bank notes and coins used as legal tender’. The full ruling can be read here.