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Implications of Accounting and Tax Treatment of Cryptocurrencies

In: Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference, Hybrid Conference, Zagreb, Croatia, 9-10 September 2021

Author

Listed:
  • Martinčević, Ivana
  • Sesar, Vesna
  • Buntak, Krešimir

Abstract

The digital revolution is changing everyday business and creating new technologies and tools that allow companies flexibility and simplicity in doing business and increase business performance. The digital age creates new concepts that also affect accounting processing, which presents new challenges in accounting practice. One of the most significant changes and innovations within accounting processing and the financial industry is the emergence of cryptocurrencies that create a completely new financial business concept. Cryptocurrency is the equivalent of electronic money and is completely digital. Although cryptocurrencies and transactions with cryptocurrencies are frequent appearances in today's modern business, accounting and tax treatment in the Republic of Croatia and other European Union countries but also beyond is not fully established and adjusted for doing business with cryptocurrencies, which requires strict regulation and adjustment operations with cryptocurrencies. As cryptocurrencies become more popular, so do taxes on cryptocurrencies that vary from country to country. Cryptocurrencies are associated with risks such as money laundering, terrorist financing, and tax evasion, which require the establishment of a regulatory body and the implementation and application of regulations in the function of the transparent business with cryptocurrencies. This paper aims to investigate the characteristics of cryptocurrencies and their financial, accounting, and tax treatment.

Suggested Citation

  • Martinčević, Ivana & Sesar, Vesna & Buntak, Krešimir, 2021. "Implications of Accounting and Tax Treatment of Cryptocurrencies," Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference (2021), Hybrid Conference, Zagreb, Croatia, in: Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference, Hybrid Conference, Zagreb, Croatia, 9-10 September 2021, pages 376-388, IRENET - Society for Advancing Innovation and Research in Economy, Zagreb.
    • Handle: RePEc:zbw:entr21:262264
    DOI: 10.54820/EDFK8186
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    References listed on IDEAS

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    1. Sheldon Bennett & Ken Charbonneau & Ryan Leopold & Linda Mezon & Carol Paradine & Anthony Scilipoti & Rebecca Villmann, 2020. "Blockchain and Cryptoassets: Insights from Practice†," Accounting Perspectives, John Wiley & Sons, vol. 19(4), pages 283-302, December.
    2. Daniel Ogachi & Paul Mugambi & Lydia Bares & Zoltan Zeman, 2021. "Idiosyncrasies of Money: 21st Century Evolution of Money," Economies, MDPI, vol. 9(1), pages 1-19, March.
    3. Zvonko Merkaš & Davor Perkov & Vesna Bonin, 2020. "The Significance of Blockchain Technology in Digital Transformation of Logistics and Transportation," International Journal of E-Services and Mobile Applications (IJESMA), IGI Global, vol. 12(1), pages 1-20, January.
    4. James R. Barth & Hemantha S. B. Herath & Tejaswini C. Herath & Pei Xu, 2020. "Cryptocurrency valuation and ethics: a text analytic approach," Journal of Management Analytics, Taylor & Francis Journals, vol. 7(3), pages 367-388, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    money; cryptocurrencies; blockchain technology; financial system; accounting; taxes;
    All these keywords.

    JEL classification:

    • Q33 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Resource Booms (Dutch Disease)
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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