There was a recent confusion surrounding the withholding of consumer funds for tax purposes. On Monday, ConsenSys, the developer of MetaMask, provided clarification to the crypto community.
ConsenSys emphasised that MetaMask does not collect taxes on crypto transactions. It stated that the tax section mentioned in the terms of service does not apply to MetaMask. In addition, it does not apply to any other sales tax-exempt products offered.
Tax terms on products and services under sales tax regime
ConsenSys took to Twitter on May 21 in response to the viral spread of a clause in the terms of service. Additionally, This raised concerns among the crypto community, aiming to provide clarity on the matter.
The company confirmed that MetaMask does not impose any taxes on crypto transactions. Further, ConsenSys assured users that the updated terms of service had no new tax-related changes.
However, it is important to note that the tax terms mentioned specifically pertain to products and services subject to sales tax. This uses ConsenSys’ Infura product as an example, which includes sales tax for credit card developer subscriptions.
What does the new update to ConsenSys Terms of Use mean?
ConsenSys emphasized its commitment to expanding Web3 adoption by offering user-friendly products and facilitating easy access and development within the crypto industry. The company’s recent updates to the Terms of Use, which included changes related to ConsenSys offerings such as MetaMask in April 2023, did not encompass any alterations to the tax terms.
The crypto community expressed criticism on Twitter, viewing MetaMask’s actions as contradictory to the principles of decentralisation and financial freedom. In addition, some even drew parallels to the Ledger controversy. They suggested that the inclusion of backdoors was intended to comply with tax obligations and governmental regulations.
According to Accounting by Glassnode, the tax mentioned in the context does not apply to customers’ capital gains tax. Moreover, it rather pertains to taxes on the sale of services between users and MetaMask. Typically, service providers are responsible for collecting such taxes, rather than placing the burden on the customers themselves.
Read More:
Bitcoin Payments App Strike Goes Global, Expanding to 65+ Countries
Tether’s Bitcoin (BTC) purchase strategy aims to diversify reserves