Influence of cryptocurrencies in the state budget of Columbia

Abstract

In the current world we are facing the appearance of new technologies that presents a challenge to the already established system, one of them being cryptocurrencies. Its core characteristic is the decentralized nature and the possibility of process anonymous transactions. Nonetheless, those present a challenge for the current system since it complicates the taxation and regulation of this asset. We center our research in Colombia, and most specially how the lack of regulation can be affecting the tax collection and therefore the state budget of the country. The analysis, using Gretl software, consisted of finding a regression model employing the Ordinary Least Squares method which could model the dependent variable tax collection. One of the most important findings was that the Bitcoin holding seems to be not correlated with the model and therefore makes us believe that there is no tax regulation being enforced enough with this asset. For this reason, we recommend that the governmental bodies and tax authorities employ a specific plan when it comes to cryptocurrencies and taxing of similar assets.