The co-founder of Toronto-based cryptocurrency exchange Coinberry claims that paying taxes in bitcoin is more efficient and cost effective than using a regular banking card.
Bitcoin More Efficient
According to a report by Mansion Global on Aug. 22, Evan Kuhn, one of the founders of Coinberry, explained the discrepancy between bitcoin and traditional payment fees.
In July, Richmond Hill became the second municipality in Ontario to approve bitcoin as a form of payment for property taxes, which has been available to residents of nearby Innisfil. Coinberry processes the property tax payments for Innisfil users paying in bitcoin, as the municipalities don't directly hold cryptocurrency due its price volatility.
Kuhn explained that when residents pay Coinberry in bitcoin, the exchange immediately converts the taxes to Canadian dollars to pay the town, in a process that works similar to using a banking card.
However, the fees for bitcoin are much lower, thereby saving the muncipality money.
According to Kuhn,
“It’s sort of like paying with a credit card. A credit card company charges a 3% fee. Our fee is .5%, so that’s a lot more beneficial for the municipalities.”
While few municipalities in Canada or the US allow for taxes to be paid in bitcoin, that could gradually see a change if the argument against traditional banking fees becomes more compelling.