Salvadoran President Nayib Bukele is trying to attract foreign capital to strengthen the BTC industry in his country, especially after the controversial path he took to make the cryptocurrency legal tender. A recent decision could be very favorable for BTC in El Salvador… if you are a foreigner.
El Salvador is trying to attract foreign investors
According to interview Javier Argueta, President Nayib Bukele’s legal adviser, foreign investors who make a profit through BTC will not pay the corresponding taxes:
“If someone has assets in BTC and makes high profits, they will not pay tax. This is to encourage foreign investment. No taxes will be paid on the capital increase or on the income. “
Under current law, capital gains are taxed at a flat rate of 10% of net profit. Capital gains on securities are also taxable. Section 5 of the BTC Act states that BTC exchanges will not be subject to capital gains tax like any legal tender. There is no mention in the law of any exception for foreign companies or traders.
Argueta’s words offer an incentive for companies to settle in El Salvador. For several months now, Nayib Bukele has been irritating the idea of opening the country to foreign capital, which is willing to develop BTC-related services. Even the cryptocurrency Strike application played a key role in the development of the Bitcoin Beach project in El Zonte. It is one of the first places in El Salvador to adopt BTC as a method of payment long before the law came into force.
But so far there is no executive order to confirm Argueta’s statement. It is important to realize that differences over the application of the law are not uncommon in El Salvador. The most famous case is the statements by President Bukele, who assures that the adoption of BTC will be voluntary and its use free of charge, although the law speaks of its mandatory adoption and BTC transactions must have an associated fee.
Private capital could be the key to BTC’s growth
BTC made a difficult debut in El Salvador. A number of protests and critics have shown the world that the population was not so enthusiastic about accepting the cryptocurrency. Subsequently, financial organizations began to disagree with El Salvador’s decision. Only one large Central American institution decided to show its support.
It is therefore not surprising that the President of El Salvador is willing to use any possible assistance, including from the private sector. Many people on Crypto Twitter have admired Bukele’s policy, and the tax exemption could be more than attractive to many of them.
And if you are one of those enthusiasts who want to move to the first 100% truly BTC country in the world, Salvadoran citizenship can be yours for 3 BTC.