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...
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.
It's absurd and against the interest of common people. While the world needs to introduce tax on extremely wealthy population, they are introducing taxes which will increase the burden of commoners. Also such kind of taxes will make the tax calculation extremely difficult. Not a good move!
I am sure that a lot of people will either move out of crypto or hide their crypto holdings from the government if this tax code becomes a law.