Blockchain based tax mechanism

A computer implemented method of facilitating a consumption tax on a purchase of one or more goods and/or services by a buyer from a seller, wherein at least the buyer is a buyer-seller who makes an onward sale based on said goods and/or services;

• the method comprising, by the seller of said purchase:
• executing a sale of the one or more goods and/or services to the buyer at a point of purchase;
• encoding a digital certificate into a request message to a tax authority computer system, the request message including an invoice for the sale of the one or more goods and/or services;
• receiving, from the tax authority computer system and in response to the request message, a response message including a payload including a cryptographic hash puzzle generated by the tax authority computer system and a template of a blockchain transaction;
• determining a first blockchain transaction that can be redeemed by a second blockchain transaction meeting either of two alternative conditions:
• a first condition requiring at least that the second blockchain transaction is signed with a cryptographic signature of the buyer, and a second condition requiring at least that the second blockchain transaction is signed with at least a cryptographic signature of a tax authority, by performing the steps of encoding the cryptographic hash puzzle into the first blockchain transaction and encoding data into the template of the blockchain transaction;
• in response to receiving a payment of the consumption tax from the buyer, sending the first blockchain transaction to a mining node of a blockchain to cause the first blockchain transaction be recorded on the blockchain and to put into escrow the consumption tax;
• receiving, from the tax authority, a notification that the seller is eligible to redeem an output of the first blockchain transaction, wherein the notification includes a solution to the cryptographic hash puzzle;
• and
• transmitting a spending transaction to the blockchain to redeem the payment of the consumption tax directly via the blockchain and without receiving a redemption of the consumption tax from the tax authority.