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.
This sounds really weird because people have to pay taxes on the assets they hold and perhaps the bill’s rationale is completely devoid of any public benefit. So how is this going to continue, is their government trying to erode taxes for whatever justification?
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.
The focus is not on the value of assets that have fallen so that taxes are lower, but this concept does not make sense at all if it is applied evenly because it speaks at the level of small ownership or large assets. The idea that the government is trying to develop there is not profitable at all and I think they only think about the benefits of taxes rather than considering alternatives that can be done by the wider community there.
Personally, I do not expect this to be the final decision and may need to be reviewed so that the regulation is more acceptable to some people involved in bitcoin and especially for the community there who are looking for alternatives to bitcoin for financial freedom issues.