The Terra Luna Classic (LUNC) community has recently approved a significant proposal that aims to streamline its tax system. This new “Reverse Charge” mechanism is set to simplify tax handling for both developers and users, making the platform more attractive to a wider range of participants.
How the Reverse Charge Mechanism Works
Under the new system, taxes will be automatically deducted from transaction amounts before they are credited to the recipient’s wallet. This eliminates the need for senders to pay additional taxes, simplifying the process for both developers and end-users.
The new mechanism is designed to be backward compatible, allowing dApps to continue using the previous sender-side taxation method if they prefer. However, the streamlined approach is expected to encourage broader adoption of LUNC and its ecosystem.
Benefits of the New Tax System
- Eliminates Double Taxation: One of the primary advantages of the Reverse Charge system is its ability to prevent double taxation on smart contracts.
- Reduces Developer Burden: By automating tax handling, developers are freed from the need to implement complex tax logic within their dApps. This simplification can accelerate development and reduce costs.
- Enhances User Experience: For end-users, the new system offers a more straightforward and transparent tax experience.
Community Efforts to Boost LUNC
The approval of the tax proposal comes amidst ongoing community efforts to support LUNC. Recent token burns, including a significant burn by Binance, have aimed to reduce the circulating supply of LUNC and potentially increase its value.
Additionally, the Terra Luna Classic Foundation has been actively delegating LUNC to key validators and infrastructure providers to strengthen the network’s security and resilience.
The Future of LUNC
The closure of the Shuttle Bridge, a key cross-chain bridge, is expected to further reduce the supply of LUNC and USTC tokens. While the exact impact of this closure is yet to be fully determined, the community remains optimistic about the future of LUNC.
As the Terra Luna Classic community continues to innovate and adapt, the new tax system represents a significant step forward in making the platform more user-friendly and developer-friendly.
Also Read: Terra Classic Community Votes Overwhelmingly on Key Proposal to Reduce Costs: LUNC Price Up 2.9%
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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