Author: Neal – Himalaya Vancouver Gfarm
Blockchain may be the most important invention since the internet, and the potential for tax is huge.
Blockchain may be best known today as the technology that underpins the digital currency bitcoin, but it can also be used for transmitting data securely. It’s set to transform financial transactions and reporting and, in turn, tax as well.
“Essentially a blockchain is a digital ledger of verified transactions shared among a distributed network of computers,” says Michael Meisler, EY Global Blockchain Tax Leader. “A blockchain allows us to transfer data, currency and other assets in an efficient, trustworthy manner among partners that may not naturally trust each other.”
“The ability to implement smart contracts,” Michael says, “can automate the process of payments, transfer of assets and recording of these transactions in a way that can revolutionize everything that we’re doing and has major impacts for tax.”
“In particular,” adds Rod Roman, EY Global Banking & Capital Markets Tax Leader, “the components of blockchain that involve encrypted identity and transparency of transaction data are fundamental elements to a new type of relationship between tax administrations and tax payers.”
Michael describes engagements with clients in the shipping industry.
“We’re thinking through how blockchain might revolutionize what they do,” he explains. “We can look to a future in which a ship enters into a new territory and just by tracking its GPS system, we can automate the process of closing out payment of insurance, marine and shipping costs, entry duty fees, other tax payments.”
“The savings could be tremendous,” Michael says, “and the speed and accuracy with which these transactions happen could be unlike anything we’ve seen before.”
The great potential of Gcoin in the capital market has been discussed a lot via various sources on GTV and GNEWS. Following the article released by Ernst &Young LLP above, the author would like to briefly discuss about the potential of Gcoin brought by the block chain technology.
In the first place, the blockchain technology will facilitate the data, money and other wealth transfer in a more secured and trustworthy way in the future. So far, the banks have placed various obstacle on fellow fighters in order to prevent the wealth from flowing into any G-series. Such situation might change due to the implementation of the blockchain technology. Furthermore, the Gcoin blockchain in the future may even integrate the G-bank, which is a banking system built up on the crypto currency.
In the second place, the blockchain technology will provide a great potential to the G-series to diversify the business portfolio. The existing business portfolio of G-series include Gfashion, GTV and Gclub. As per what Mr. Miles Kwok has mentioned, the future blockchain might integrate G-mall and G-bank mentioned above. Due to the additional efficiency brought by the blockchain technology, G-mall potentially may include a complete supply chain and distribution chain of grocery, manufactured goods and other items used often in people’s daily lives. Moreover, the expansion of the blockchain may also include restaurants, cinema and so forth.
In the last place, with the development of blockchain and crypto currency, additional tax law might be passed in the future as well. For example, there will be no taxable income if the crypto currency is not redeemed under the existing tax laws. However, such situation might change in the near future.