Chile Tax Agency Clarifies Taxation of Financial Services, Digital Asset Transactions on Blockchain Platform

The Chilean Internal Revenue Service Oct. 12 issued Letter No. 3017, clarifying the taxation of digital assets linked to the provision of financial services. The taxpayer, a digital platform based on blockchain technology, sought clarification as to the taxation of platform token transactions. The agency clarified that: 1) token transfers between the platform and users aren’t subject to income tax, to the extent the value is equivalent to the Chilean pesos delivered; 2) exchange transactions in the soft liquidation process constitute transactions subject to income tax; 3) services provided by the platform are subject to VAT; and 4) transactions paid ...