Swiss city of Lugano to pay taxes in crypto via Tether partnership
The city of Lugano, the economic capital of Italian-speaking southern Switzerland, is adopting cryptocurrencies for tax payments as part of a new collaboration with the provider of Tether (USDT) stablecoin.
Tether Operations Limited, the blockchain-based platform that powers USDT, the world’s largest stablecoin by market capitalization, has signed a partnership with the administration of Lugano, according to a joint announcement on Thursday.
Tether and the city administration have established a center of excellence for blockchain adoption with a goal to become a major European blockchain hub.
The collaboration intends to demonstrate the real-world use cases of blockchain by applying it practically in the local community, including adopting cryptocurrency payments and experimentation of blockchain solutions on an urban scale. Tether and the city specifically plan to implement the Lightning Network, a second layer added to Bitcoin’s (BTC) blockchain, in order to overcome the scalability obstacles of its crypto city infrastructure.
Lugano aims to scale its efforts to enable citizens and companies to pay their taxes in cryptocurrency in the near future, pending several formal approvals and infrastructure projects. The ultimate goal is to accept crypto for payment of all goods and services, equating it with a fiat currency, the announcement notes.
As part of the partnership, Tether will also create a multi-million dollar fund to help finance blockchain-based startups and blockchain services in the region. Additionally, Tether will contribute its expertise and support to the city of Lugano to provide industry education through collaborations with local universities and research institutions.
According to Lugano Mayor Michele Foletti, the latest partnership with Tether will help the city further scale its fintech efforts and development. He mentioned that the city of Lugano has been actively involved in the crypto and blockchain technology in recent years, including its work on LVGA Points citizen payment tokens, nonfungible tokens and other blockchain developments, stating:
“Lugano is investing in its future. In recent years, we have already implemented blockchain-based solutions including the MyLugano app and its LVGA Points payment token, the Lugano digital franc and the 3Achain blockchain infrastructure.”
The news comes amid the city of Lugano and Tether hosting a live event on the city’s adoption of crypto on Thursday, as announced last week.
#bitcoin and stablecoins are revolutionizing the financial sector. #tether and The City of Lugano @luganomycity are teaming up to transform Lugano into the European #bitcoin capital.
Every city needs a plan. Join Lugano’s Plan ₿ pic.twitter.com/wmhFVePcPo
— Tether (@Tether_to) February 21, 2022
Related: Colorado governor says he expects state to accept tax payments in crypto by summer
As previously reported, there are a number of cities and cantons in Switzerland that allow its residents to pay taxes in crypto, including the Swiss canton of Zug and Zermatt municipality.