I think that's one way it could be put. We're faced with a difficulty, because there is no recipient, and GST relies on there being an identifiable recipient. The fact that there's not makes it impossible to charge GST.
Is it appropriate to have no tax applied to the industry as a whole?
There are different ways that can be done. The choice the government has made in this particular case is to bring it outside the scope of the GST to ensure that at the end of the day, some tax sticks. There is some consumption of crypto services in Canada. We can't apply the tax in the normal way, so the services are effectively being input taxed.
Again, I would go back to the fact that there is this large exception for people when there is an identifiable recipient. I would argue that in most cases, particularly now the rules are out, people will ensure that their affairs are arranged to take advantage of that exception.
We're not being punitive in any way. It's really just a structural concern with the Excise Tax Act and the fact that the rules were not designed in a way that could easily accommodate this new industry.