LUNC News: OrbitLabs Proposes Testing for New Terra Classic’s Tax Mechanism

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As an analyst with years of experience in the blockchain industry, I find the proposal by OrbitLabs to review the new “Reverse Charge” tax mechanism for Terra Classic quite intriguing. The potential benefits of this system, such as its simplicity and compatibility with existing systems, could significantly improve the user experience on Terra Classic.

News about LUNC: OrbitLabs suggests an in-depth examination of the recently proposed “Reverse Taxation” system on Terra Classic. This tax method intends to streamline tax management within the blockchain by withholding taxes from the receiver instead of the transmitter.

Obtaining the community’s endorsement will enable OrbitLabs to move forward with the evaluation process. This step is crucial as it guarantees the system’s dependability and security prior to its complete deployment.

LUNC News: OrbitLabs Proposes Testing Terra Classic’s Tax Mechanism

As per a recent update on X (previously known as Twitter), OrbitLabs has expressed their plans to examine the recently suggested “Reverse Charge” tax system applicable to Terra Classic.

Under the suggested plan by StrathCole and HCC, the new system will do away with the necessity for tax administration on the blockchain. Instead, it will automatically deduct taxes from the person receiving a transaction, which is a departure from the existing method where the sender has to add additional tax costs to the transactions.

In simple terms, OrbitLabs requires the community’s approval within six days for the review process to move forward. They are seeking a Pay-Per-Job (PPJ) agreement with a compensation of $2,500 USD, which will be paid in LUNC once the task is completed.

This review would include code audit, feature validation and validation of whether the new mechanism is consistent with the goals of Terra Classic in regards to simplified tax management.

Potential Benefits of the Reverse Charge Mechanism

The Reverse Charge mechanism proposed here aims to minimize the tax procedures and might be less complicated than the previous models such as Tax2Gas. This way, the new method could remove the need for senders to calculate and attach extra fees to the transaction, thus improving the user’s experience.

According to OrbitLabs, this system intends to ensure compatibility with existing platforms to reduce interruptions for dApps and other external services running on Terra Classic. In simpler terms, it means the new system aims to work well with what’s already in place to keep things running smoothly for applications built on Terra Classic as well as other related services.

Hey #LUNCcommunity,

the reverse charge approach for #burntax is live on rebel-2 testnet now.

We invite decentralized applications (dApps) and developers everywhere to try out their smart contracts on the rebel-2 network. This will help ensure that the new changes are compatible with earlier versions, avoiding any issues or disruptions for existing applications.

— StrathCole (@ColeStrathclyde) November 7, 2024

Preliminary tests conducted on Terra Classic’s rebel-2 test network indicate that the Reverse Charge system could potentially be efficient and even compatible with existing systems. StrathCole, a developer, presented test findings demonstrating that tax deductions can indeed be made without disrupting other decentralized applications (dApps) functioning.

In a single transaction using a wallet extension, a user transferred 1 million units of LUNC, but due to taxes, the receiver only got 995,000 LUNC. There were no extra charges imposed on the sender for this transfer.

Proposed Work and Timeline for OrbitLabs’ Review

If approved, OrbitLabs has set a two-week timeline for their review process. During the first week, they aim to thoroughly examine the Reverse Charge code to ensure its security and proper functioning. The second week will be dedicated to making necessary adjustments and updates to the testing phase, ensuring the mechanism works flawlessly in various scenarios and is compatible with the latest Terra Classic SDK version, 0.47.

In the past, OrbitLabs has worked alongside the Terra Classic development team, providing support for previous tax-related projects.

In this scenario, the organization is pledging to collaborate closely with Terra Classic developers and community members to tackle any problems that might surface during testing. Additionally, OrbitLabs has successfully passed KYC verification through sollidproof.io, meeting the conditions specified in Proposal #12129 for contributors involved in code review.

Despite recent developments with Terra Luna Classic (LUNC), its price has been experiencing an uptrend, currently sitting at $0.00009364. This represents a 1.97% increase from its 24-hour low. The bullish trend is further supported by CoinGape’s analysis, which hints that the LUNC price could potentially surge by as much as 207%, given the approval of the “Reverse Charge” tax mechanism.

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2024-11-07 23:40