El Salvador’s president, Nayib Bukele, who is known for his support for Bitcoin, has signed a law that eliminates taxation on technological innovations in the country. This move could attract innovative companies and foster technological growth and development in the nation. The Innovation and Technology Manufacturing Incentive (ITMI) Act removes taxes on property, income, capital gains, import tariffs, software and application programming, AI, computer and communications hardware manufacturing, among other sectors.
The Country is Pushing for Technological Growth and Development
President Nayib Bukele announced the signing of the ITMI Act on his Twitter handle on May 4, 2023, after earlier indicating his intentions to introduce a bill to safeguard innovative technological advancements in the country. This newly signed law is part of Nayib Bukele’s efforts to promote technological growth and development in El Salvador.
El Salvador’s Welcoming Stance on Innovative Tech and Crypto Mining Firms
The signing of the no-tax law by President Nayib Bukele could incentivize innovative companies abroad to shift operations to El Salvador, which now has a positive tax law. This move could exponentially scale BTC mining activities by corporations, especially with Nayib Bukele’s efforts to build a Bitcoin city near the Conchagua volcano in the country. The energy required for mining will be sourced directly from the volcano, which generates hydrothermal energy.
Promotion of a Thriving Technological Innovation Ecosystem
In January 2023, El Salvador established a legal framework and process for issuing Bitcoin-backed bonds, also known as “Volcano Bonds,” for sovereign debt payments. These efforts to promote technological growth and development in El Salvador could attract innovative companies and foster a thriving technological innovation ecosystem in the nation. While the US recently proposed a 30% tax on crypto mining operations, El Salvador continues to promote a positive tax law that supports technological innovation.
Source: Bitcoinist
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