The Australian Taxation Office recommends taxing DeFi transactions, but does not clarify whether it will apply to liquidity staking and L2 bridging operations

The Australian Taxation Office (ATO) released new guidance on November 9, recommending the imposition of capital gains tax (CGT) on a range of DeFi transactions. The new guidance states that capital gains tax will be payable when a user transfers tokens to another address or smart contract that does not have “beneficial ownership” or if the address has a non-zero token balance. While the standards hint that the rules may cover liquidity staking, the guidance does not clarify some confusing issues, such as whether users staking Ethereum on Lido or sending tokens across L2s need to pay taxes. Without the rules being clear enough, assuming an Australian DeFi user buys ETH for $100 and then stakes or sends it via a bridge when the price is $1,000, they risk paying tax on their $900 "profit" even though they haven't Sell ​​ETH or realize profit. An ATO spokesperson said the taxation status of a transaction will depend on the steps a user takes on the platform or contract, as well as the relevant facts and circumstances of the taxpayer who owns crypto assets. Liberal Senator Andrew Bragg said the previous government had tasked the tax committee to come up with appropriate rules for taxing cryptocurrencies, but the findings had been delayed twice and the results would not be released until February next year. In the absence of legislation, the Australian Taxation Office is allowed to make its own rules. (Cointelegraph)