Canada’s electoral body has started consultations on how political parties should handle cryptocurrency donations ahead of general elections slated for October. Political parties have requested guidance from Elections Canada (EC) on accepting contributions and conducting other transactions in bitcoin. EC has now released a draft note that broadly takes the position that cryptocurrency donations are non-monetary, in-kind contributions.
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‘Cryptocurrency Is More Like Bonds and Stocks’
In the draft guidelines published on the Elections Canada website, the autonomous agency states that virtual currencies “have traits of both money and property”, but stresses that they are not the same as money. It says a cryptocurrency donation is non-monetary, describing it more as bonds or stocks, and is therefore not eligible for a tax receipt. However, it should be received within the stipulations and limitations of the Canada Elections Act (CEA).
“Like money, they [cryptocurrencies] can be used to make purchases from businesses that choose to accept them,” the note reads. “But unlike money, they cannot be placed directly into a bank account. Instead cryptocurrencies can be sold for traditional currencies that can be placed into a bank account.” This characteristic, according to Elections Canada, qualifies digital currencies as “a form of ‘property’ and fall under the definition of a non-monetary contribution.”
The position mirrors that of the U.S. Federal Election Commission. Most Canadian government and auditing bodies have already taken the position that cryptocurrencies are non-monetary. The Canada Revenue Agency considers crypto to be a commodity, subject to barter transaction rules when used to buy goods or services.
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