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Sweden: Supreme Administrative Court Rules Trade in Bitcoins Not Subject to VAT

(Feb. 4, 2016) On February 2, 2016, the Swedish Supreme Administrative Court issued a ruling that trade in Bitcoins is not subject to value-added tax (VAT). (Högsta förvaltningsdomstolens dom [Supreme Administrative Court’s Judgment] (SAC Judgment), Nr. 7101-13 (Feb. 2, 2016).)

The judgment was based on a case in which the Swedish Tax Authority had appealed a preliminary decision made by the Swedish Revenue Law Commission (Skatterättsnämnden) that the sale of Bitcoins by an individual would be exempt from VAT. (Id.)

The Swedish Supreme Administrative Court had first asked the European Court of Justice (ECJ) to give a preliminary judgment on the matter. (Elin Hofverberg, Court of Justice of the European Union/Sweden: Purchase and Sale of Bitcoins Not Subject to VAT, GLOBAL LEGAL MONITOR (Nov. 5, 2015).) The ECJ replied and found that the sale and purchase of Bitcoins should be considered a service exempted from VAT. (Id.; Case C-264/14, Skatteverket v. David Hedqvist, 2015 (ECJ Preliminary Ruling) INFOCURIA – CASE-LAW OF THE COURT OF JUSTICE (Oct. 22, 2015).)

Citing the ECJ preliminary ruling, the Swedish Supreme Administrative Court upheld the original preliminary decision made by the Swedish Revenue Law Commission in which it had determined that the sale and purchase of Bitcoins would be exempt from VAT. (SAC Judgment, supra.)