Energy Riches Fuel Bitcoin Craze For Speculation-shy Iceland (apnews.com)

Iceland is expected to use more energy "mining" bitcoins and other virtual currencies this year than it uses to power its homes. From a report: With massive amounts of electricity needed to run the computers that create bitcoins, large virtual currency companies have established a base in the North Atlantic island nation blessed with an abundance of renewable energy. The new industry's relatively sudden growth prompted lawmaker Smari McCarthy of Iceland's Pirate Party to suggest taxing the profits of bitcoin mines. The initiative is likely to be well received by Icelanders, who are skeptical of speculative financial ventures after the country's catastrophic 2008 banking crash. "Under normal circumstances, companies that are creating value in Iceland pay a certain amount of tax to the government," McCarthy told The Associated Press. "These companies are not doing that, and we might want to ask ourselves whether they should."

Comments

Schmeptical

[Hognoxious]

Icelanders, who are skeptical of speculative financial ventures after the country's catastrophic 2008 banking crash

Skeptical my arse, they made out like bandits.

It was their customers that lost out.

http://www.thisismoney.co.uk/m...

Re:Value Added Tax

[angel'o'sphere]

Every bussiness where you create value 'from nothing', like fishing and farming, has VAT rates for the sold products that are actully not worth colecting as the oversight about it costs more than the VAT returns.
So you want to say: if you mine gold in Icelands and sell the gold you have to add VAT on the sale, and give it to the tax bureaus? If that is the case, bitcoin should be handled similarily (and the law actually most likely covers that already, so no law change required, or not?)
If it is not the case it should have no extra tax but handle it via income/corporate tax.