Zimbabwe made its interim currency the country’s sole legal tender on Monday, ending a decade of dollarization and taking a another step towards relaunching the Zimbabwean dollar.
The central bank also hiked its overnight lending rate to 50% from 15% as a part of a set of measures to protect the RTGS dollar introduced in February.
“The march towards full currency reform is part of our transitional stabilization program,” Finance Minister Mthuli Ncube said in a video posted on Twitter. “This move is really beginning to restore full monetary
Zimbabwean President Emmerson Mnangagwa, who replaced longtime leader Robert Mugabe after an army coup in November 2017, is trying to repair an economy ruined by hyperinflation and a long succession of failed economic interventions.
But a hoped-for economic turnaround is yet to materialize, and many Zimbabweans are distrustful of Mnangagwa’s promises.
Mnangagwa’s government last month agreed a staff-monitored program with the International Monetary Fund (IMF) whereby the fund will help Zimbabwe implement coherent economic policies.
Analysts are skeptical that the latest currency reforms will be a quick fix for the deep problems that have constrained economic growth in the southern African country.
“Zimbabwe will have to show results before people are convinced,” said Jee-A Van Der Linde, an economist at South Africa-based NKC African Economics.
Van Der Linde said banning the use of currencies such as the U.S. dollar and South African rand could create panic since Zimbabwe did not have large foreign-currency reserves to back the RTGS dollar.
There was nothing standing in the way of the Zimbabwean central bank printing money as it had done in the past, he added.
The central bank said in a statement on Monday that it had put in place letters of credit worth $330 million to secure imports for important goods such as fuel.
It would also try to boost liquidity on the interbank forex market by removing a cap on margins for banks and making sure that more than 50% of the foreign currency that Zimbabwean companies have to surrender ends up on the interbank market.
Zimbabwe abandoned its own dollar in 2009 after years of hyperinflation had destroyed trust in the local unit.
Mnangagwa said this month that Zimbabwe must reintroduce its own currency by the end of the year.
The IMF has said Zimbabwe should quickly allow the RTGS dollar to float freely, allow exporters to sell dollars at the interbank rate rather than surrender them to the central bank, and raise interest rates to curb inflation.
The RTGS dollar has been hitting new lows on the black market in recent days.
The current state of taxation on cryptocurrencies-
One of the biggest hurdles while trading in cryptocurrencies is the calculation of taxes also known as Crypto Tax of the investments and returns. Most people despise the idea of filing their regular taxes. The idea of filing taxes for cryptocurrencies is generally met with more frustration and annoyance.
Moreover, cryptocurrency tax rules vary with each country. Several countries have a severe lack of ground rules and regulations surrounding cryptocurrency taxation. Dealing with cryptocurrencies is undoubtedly much more difficult in such countries in comparison to those countries with set regulations. The general population’s confusion around cryptocurrencies is entirely understandable.
Despite this, people across the world are getting themselves involved with cryptocurrencies at varying degrees. People have come to realize that they can learn the fundamentals of this payment system and using a crypto tax calculator to file and report their taxes.
The need for a crypto tax calculator
A crypto tax calculator is an invaluable tool that automates and speeds up the process of calculating taxes and yields accurate results. Whether you are an enthusiastic amateur trader with a few bitcoins under your belt or you are a seasoned cryptocurrency day trader, the tools mentioned in this article are bound to help you.
Since the inception of cryptocurrencies in 2009 spearheaded by Bitcoin, a significant number of quality crypto tax calculators have been come up to make the crypto taxpayer’s job easier. While there are countless crypto tax calculators, we will mention a few of them that you can choose from to take care of your crypto taxes.
Concern over risks that come with cryptocurrencies-
Given the volatility and complexity of cryptocurrencies, people have become apprehensive, albeit curious about the value and role of cryptocurrencies in the digital age. While most people understand the fact that cryptocurrencies are secure, they realize that they are also prone to loss and theft. No central authority or external influence can control cryptocurrency transactions. It is possible to trace transactions but impossible to track the accounts back to their respective real-world identities.
The top crypto tax calculators-
Koinly is one of the most popular crypto tax calculators in recent times. It has its Headquarters in London. Owing to the sleek and intuitive UI, it is perfect for regular traders and amateur crypto enthusiasts alike.
Another point in Koinly’s favor is that a new user can start using it for free and pay when the final reports are to be generated. In addition to this, it officially supports the tax systems of over 100 countries, 33 exchanges, and six blockchains. It also has several notable features that include a portfolio tracker.
Koinly seems to have the edge over most crypto tax calculators as they develop their tax reports in partnership with audit consultants from KPMG. Hence, they are legally compliant. Their reports also support all the primary accounting methods, including the ACB (Average Cost Basis) and FIFO (First in First out) method.
CoinTracking analyzes your transactions and generates real-time reports on various things like profit and loss, the value of your Bitcoins, realized and unrealized gains, and reports for taxes.
Cointracking seems to be an all-in-one solution for your cryptocurrency taxation and portfolio tracking requirements.
It is also compatible with some third-party crypto tax calculators and software like TurboTax. Of course, this depends on the country out of which you are based.
Bitcoin.Tax is known as one of the oldest crypto tax calculators. As a result, it is a highly trusted crypto tax calculator among long-time crypto investors and crypto enthusiasts.
The downside to this crypto tax calculator is that it looks dated compared to its competitors like Koinly and Cointracking. Just like Cointracking, Bitcoin.Tax has also partnered with TurboTax to support the seamless importing of cryptocurrency tax data into mainstream income tax reports.Bitcoin.Tax seems to suit old-school accountants owing to their not so clean interface and the presence of a large amount of text.
It is likely to be the one for you if you are looking for a traditional crypto tax software.
BearTax is similar to Coinbase due to its simple UI and design language.
Their key selling points seem to be the diversity of features, options in pricing, and functionality.
Like all other crypto tax calculators mentioned, BearTax supports the important exchanges and cryptocurrencies. However, It should be said that BearTax could do very well with a few more intuitive features like a performance tracker.
Zenledger is another quality crypto tax calculator. Users can import cryptocurrency transactions and calculate their capital gains and crypto-related income.
The transaction history is imported, following which the tool generates all the crypto tax-related entities such as capital gains, income, donations, closing reports, and profit and loss statements.
As Blockchain technology continues to spread, we will witness the increase in the number of crypto tax calculators. However, a crypto trader must understand the fundamentals of cryptocurrencies to make the best use of crypto tax calculators. In order to take care of your crypto taxes seamlessly, you ought to spend some time searching for the crypto tax calculator that is right for you.