Australia’s government has provided some positive news for those who operate with cryptocurrencies as it exempts the currency from its latest restrictions on cash payments.
Under section 9 of its explanatory memorandum issued last week, digital currencies were highlighted as one of five exemptions against the new $10k AUD cash payments cap set for 2020. The paper sets out guidance and legislative rules on cash payments for goods and services which exceed 10,000 AUD ($6,900).
The main areas where payments not subject to the cash payment limit are:
• Payments related to personal or private transactions
• Payments that must be reported by an entity under anti-money laundering and counter-terrorism legislation, provided, broadly, the entity with a reporting obligation complies with their obligations under that legislation;
• Payments made or accepted by a public official in-line with their duties
• Payments that exceed the limit because the payment is part of cash-in-transit services
• Payments that only exceed the cash payment limit because payment is orincludes an amount of digital currency
• Payments that occur in situations where no alternative method of payment could reasonably be used.
In describing the exemption of digital currencies, the memorandum explained :
Digital currency is a new and developing area in the Australian economy. Unlike physical currency, it does not have a firmly established regulatory framework or industry structure. This makes it difficult to apply the cash payment limit in a way that would not largely prevent the use of digital currency in Australia or significantly stifle innovation in the sector.
The memorandum also noted that ‘there is little current evidence that digital currency is presently being used in Australia to facilitate black economy activities. Given this, the Government has decided at the present time to effectively carve digital currency out from the cash payment limit.’
If the memorandum is approved, it would mean the $10,000 AUD limit would apply as early as January 2020.