El Salvador is the first country to introduce Bitcoin (BTC) as legal tender. Now the government of El Salvador has decided that all taxes on technological innovations will be abolished. This includes technological innovations such as coding, app development and AI, and the production of computer and communication hardware. This major step is accompanied by the establishment of the “National Bitcoin Office” (ONBTC) of El Salvador, also known as “the Bitcoin office” in the Salvadoran vernacular.
El Salvador strives for tax-free technological innovation
On September 7, 2021, Bitcoin was approved by the Salvadoran President Nayib Bukele legalized. The president saw the technology as a means to combat hyperinflation and reduce reliance on the US dollar. Over the past 18 months, El Salvador has restructured Bitcoin investments and, in many cases, used the profits to rebuild the country.
To continue the strategy that has been deployed, the president of El Salvador believes in phasing out all taxes on technological innovations. This with the idea of accelerating technological developments.
President Nayib Bukele sent a official bill to the Congress of El Salvador. The bill states that technological innovations “such as software programming, coding, apps and AI development, as well as the production of computing and communications hardware” should be exempt from income, property and capital gains taxes.
Future technological and economic power?
In conjunction with the establishment of the Bitcoin office (ONBTC), El Salvador aims to position itself in the world as a technological and economic power, according to Bitcoin Association of El Salvador (Bitcoin Association of El Salvador). The idea behind ONBTC is that it becomes a regulatory body for carrying out joint initiatives with Bitcoin entrepreneurs and companies.
With this, the president of El Salvador not only wants to make an attempt to accelerate technological innovations, but also to stimulate tourism in the country, fight terrorism in a better way and build better regional business centers. A large part of the inhabitants support the president of the famous Bitcoin country.