Re: Denmark consider taxing unrealized gain on bitcoin.
This new proposed bill sounds wild. It would mean holders have to declare their assets and pay taxes on any increase in value from their original purchase, even on unrealized gains. So, even if you’re just holding, you’d have to report it every year.
Now, if the value drops, sure, maybe you’d pay lower taxes or get a tax offset, but it’s still odd. Think about it: you buy Bitcoin at $10,000, and over the next five years, it rises, so you’re paying annual taxes based on that value increase. But then, if the price tanks overnight and you sell in a panic, you’re at a loss - yet the government’s already pocketed tax from your unrealized gains.
And look at the percentage of tax...
If the Denmark government decides to go ahead with such a policy, am sure many individuals wouldn't agree to invest in Bitcoin, because the tax is just too outrageous to be frank. Now, if the value drops, sure, maybe you’d pay lower taxes or get a tax offset, but it’s still odd. Think about it: you buy Bitcoin at $10,000, and over the next five years, it rises, so you’re paying annual taxes based on that value increase. But then, if the price tanks overnight and you sell in a panic, you’re at a loss - yet the government’s already pocketed tax from your unrealized gains.
And look at the percentage of tax...
Similarly, the Italian government mulled raising the capital gains tax specifically for Bitcoin holdings from 26% to 42% beginning in 2025.
If a country like the UAE has opted to not tax Bitcoin and other crypto currencies because it wants to be one of the largest investors in cryptocurrency, thereby boosting its economy and improving the standard of living by owning mining farms as well, am sure other countries can do same if they know the advantages of allowing crypto currency and Bitcoin in particular to be a main stay financial component of its economy.