Post
Topic
Board Economics
Re: Distribution of bitcoin wealth by owner
by
boumalo
on 21/04/2014, 12:29:47 UTC
I hear the US is targeting Vladimir's $40 billion stash in Switzerland.  If only there was a way to store wealth without the assistance of a third-party or the permission of an authority:

https://bitcointalk.org/index.php?topic=578286.0

By way of redistributing wealth, and funding the State, I would not be surprised, and increasingly suspect that bitcoin holdings will eventually be considered property subject to tax, in the same way that land is taxed in the USA. In democracies, new sorts of taxes have been in the past introduced at very modest rates and limited to apply to a minority of taxpayers so as to be politically acceptable to the majority.

The most palatable form of a bitcoin holdings tax would be one in which the rate of taxation is substantially less than the rate of deflation. For example, if I would not leave the USA and hide my family if the tax rate was 0.1% of holdings annually, given my expectation of 1000% price growth on average annually for the next few years.

The blockchain is public and I believe facilitates the collection of taxes in jurisdictions such as the USA in which tax compliance by citizens is voluntary.

Note that I am for fair taxation, as tax jurisdictions serve the common good. I am not for the confiscation of bitcoin by governments - simply because early adopters may eventually be sudden new $ billionaires and perhaps in a few cases $ trillionaires.

I practice this is already the case in the Netherlands. Annually people pay 1.2% tax over all there holdings over ~21k Euro (Excluding items you use such as your house and cars, for arbitrary reasons). Your net worth include your Bitcoins (as the Dutch IRS has made very clear) so I already paid the tax in 2013.

*This tax is to tax investment gains without having to check them. therefore we don't have to pay things such as capital gains tax and dividend tax.

A simple low level tax is better than a complicated one but being taxed on your holdings is racket : you never really own them since you need to pay a rent or be thrown in jail