There’s a town in Canada that is making some big promises with regards to Bitcoin. But how close to the truth is this promise? Innisfil, a town situated in Ontario has reportedly approved a test project that will let locals pay property taxes in Bitcoin! Sounds pretty revolutionary right?
— Town of Innisfil (@townofinnisfil) March 28, 2019
Well, there might be a catch.
The project that will be launched completely next month holds the promise of cheaper taxes as the processing fee for Bitcoin will go down to 0.5% and will be quite a sigh of relief for the 36,000 residents. The venture is made possible by the help of Canadian firm Coinberry Pay which is a fintech organization.
As per the town’s staff report summary;
The demand for this service in Innisfil is unclear at this time; however, innovative solutions and concepts are quickly becoming our identifying feature in attracting and retaining progressive entrepreneurs and professionals to our community.
However, you know what they say. If it sounds too good to be true, it probably is. And although the town is making leaps and bounds by becoming the first in the country to start accepting Bitcoin, no banks will actually hold any of the crypto. Yes, that’s right. All the transactions in Bitcoin will be converted into Canadian Dollars via Coinberry Pay and then transferred to a local bank.
So much for being revolutionary?
According to some critics, this was a way for political parties and candidates to appear more progressive and appeared as a publicity stunt than as an actual move towards a digital era.
But apparently, there’s more mixed news on the way!
There is even the chance that residents and businesses using this new method would have to pay certain “hidden charges” due to fluctuations in value as Innisfil has already warned users of the uncertainty.
For example, if a user sent 1 Bitcoin to pay for their taxes at 12:01 am when the rate to sell Bitcoin on the Coinberry platform was $5,000 CAD/Bitcoin but the 4th confirmation on the blockchain took place at 12:40 am and by that time the rate to sell Bitcoin on the Coinberry platform had changed to $4,950 CAD/Bitcoin, Coinberry would be responsible to remit to Innisfil $4,950 CAD and the user (taxpayer) would be responsible for the remaining $50 to satisfy their tax account obligation.
Alternatively, this means that if the prices ever rose or appreciated, the town would in stead owe the users, residents and businesses.