Here in my country which is now an upcoming tiger economy (though we are still classified as a third-world country), we are free to participate in Bitcoin both buying and selling as the government is treating Bitcoin just like any other foreiign money.
However, I am sure that only a very, very small fraction of us are declaring our Bitcoin income. It seems to me that the government is not that interested to get strict with individuals as long as they can tax the Bitcoin exchange provider for the service rendered.
I am then wondering the situation with other countries. Can your government really be able to track if you never declared gains made from Bitcoin transactions?
Hi! in my country, we are free also to participate in Bitcoin buying and selling without consent to government. It seems that the government unable to track the Bitcoins income of an individual and give tax in it. Taxes may come after an individual exchange/claim/check out Bitcoin and converted to Local currency, then go to a shopping, pay bills, buy food and etc. In this way the government can collect tax to an individual. Like what you said if not declaring Bitcoin income the government hardly track it or not even traceable.