Crypto Taxation

[atjiat]

I myself am from Ukraine and still live in this country and today, in fact, cryptocurrency is legalized and every cryptocurrency asset is recognized as a means of payment, a valuable asset and an asset for investment, but there is a certain framework for taxing activities on the cryptocurrency market.  In any case, no user will pay tax on the available cryptocurrency reserves in their wallets, but taxes will be levied only on very large transactions when trading cryptocurrency.  Since the cryptocurrency market in my country so far has been out of sight, that is, it was in the shade, we still have to imagine seeing how all this will work when citizens show interest in cryptocurrency assets.

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[khunyung]

I myself am from Ukraine and still live in this country and today, in fact, cryptocurrency is legalized and every cryptocurrency asset is recognized as a means of payment, a valuable asset and an asset for investment, but there is a certain framework for taxing activities on the cryptocurrency market.  In any case, no user will pay tax on the available cryptocurrency reserves in their wallets, but taxes will be levied only on very large transactions when trading cryptocurrency.  Since the cryptocurrency market in my country so far has been out of sight, that is, it was in the shade, we still have to imagine seeing how all this will work when citizens show interest in cryptocurrency assets.

You're saying cryptocurrencies do have actual legal status of a payment option in your country, but only big transactions come with taxes?
I barely can believe it, could you please proof, because if what you're saying is true that mean your country is a damn heaven for crypto traders

[frank0ly]

I totally agree with that. Governments always want to capitalize on everything that’s possible. And I’m sure that they won’t miss such a chance not to tax cryptocurrency. I don’t like it, but I don’t know what can be done about it.

[worle1bm]

I totally agree with that. Governments always want to capitalize on everything that’s possible. And I’m sure that they won’t miss such a chance not to tax cryptocurrency. I don’t like it, but I don’t know what can be done about it.

Yeah, it seems illogical why government will tax something which is consider as threatening for country. Most of the governments oppose cryptocurrencies but when it comes to earn free money, they are ready to tax crypto earnings of citizens which is entirely wrong. We are generating wealth from something entirely created out of thin air. We are not using the resources of a country. Rather we are creating intangible wealth on internet using logics and powerful codes. I don't know how can government claim the share of our earnings.

[coinlevy]

I totally agree with that. Governments always want to capitalize on everything that’s possible. And I’m sure that they won’t miss such a chance not to tax cryptocurrency. I don’t like it, but I don’t know what can be done about it.

Yeah, it seems illogical why government will tax something which is consider as threatening for country. Most of the governments oppose cryptocurrencies but when it comes to earn free money, they are ready to tax crypto earnings of citizens which is entirely wrong. We are generating wealth from something entirely created out of thin air. We are not using the resources of a country. Rather we are creating intangible wealth on internet using logics and powerful codes. I don't know how can government claim the share of our earnings.

I think you misunderstand how cryptocurrency is treated by governments across the world. Most countries treat them as commodities. Like any commodity, when traded you either make a gain or loss. To legalize the cryptocurrencies, categorizing them within a certain tax bracket is important. It does not hamper the decentralization process, rather enables the ecosystem to be more mature. Also, right now if you check, you will see most of the countries have legalized cryptocurrencies with only a handful (around 7) where it is still illegal.

Paying taxes is a broad philosophical question, and innumerous people have spoken against and for it. Hence lies beyond our control.

[Abiky]

If the transactions remain anonymous, then the chance of tax evasion will increase and it will become easier to hide your income. The authorities don't want that and they want to extract whatever they could from the hard working individuals. On the outside, they will say that KYC and all that crap is needed to prevent terrorism and crime. But the real intention is to increase the tax collection.

Exactly. As long as transactions are anonymous, there's virtually no way a government will be able to collect tax from you. They've noticed this already, leading them to wild ideas on how to get rid of privacy solutions within the crypto space. For once, the US talked about the possibility of banning privacy coins in their entirety (as these coins promote tax evasion and money laundering according to the government). If all the countries of the world start rejecting privacy solutions within the crypto space, then I'm afraid that people will be forced to pay taxes in every way. Personally I don't have a problem paying my taxes in crypto, but it goes against the way crypto and Blockchain tech was designed initially (which was to eliminate the middleman and counterparty risk).

Only time will tell us if people will agree unanimously with governments' decisions or not. If people don't complain about crypto taxation, then governments will continue with the endeavor without interruptions. It's up to you and me to make the difference in order to make crypto as good as it was in its early days. The mere fact that centralized exchanges dominate the crypto space, makes taxing crypto a piece of cake. Just my opinion

[boltz]

They will try harder and harder to make cryptocurrencies taxes to be everywhere in world and probably they won't stop there. Look at Libra how many difficulties they have to launch their project and the coin so if Bitcoin would have been created today I doubt it would have had the same success and trust like it has now.

In my country they already made cryptos taxable since last year but we have a lot of ATM's and easy access to buy Bitcoin and other cryptos but if we look on other situations from other countries , they don't have access to Bitcoin so easily or some other don't have access at all as cryptocurrencies are banned in some countries.

[FlightyPouch]

I totally agree with that. Governments always want to capitalize on everything that’s possible. And I’m sure that they won’t miss such a chance not to tax cryptocurrency. I don’t like it, but I don’t know what can be done about it.

It is not that mainstream in our country but if it did, I am sure that it will be having a tax in the future. I don't know how would the government do that but for surez they will find a way. There are some exchange here in our country and they might find that as a way or a chance to tax users of crypto currencies here.

[STT]

The thing is crypto relates to cash not securities like shares.   The exchange of value just by itself isnt a taxable event in most countries, gold for example is often protected from taxes as a holding.   Silver can be subject to sales tax because its used for cutlery and jewelry and is a bit more industrially used.    Its unfortunate if just sending cash makes a person requiring an accountant, luckily I'm not that rich either way.

[qwertyup23]

Sad to say, it's just how things go most of the time. Even I am a critic of taxing cryptocurrency transactions since after all it defeats the purpose of cryptocurrencies being decentralized in the first place. But if you consider the fact that it'll allow cryptocurrencies to be much more accepted and accredited by your local government almost outweighs the feeling of being taxed. Until we can find a way to ensure cryptocurrency transactions safer and a bit more convenient than what it is now we might need to put up with what the government wants

I agree with your statement.

There exists a boundary between the taxation of cryptocurrency (which would benefit its users as it will provide a layer of protection and regulation) but it will defeat the very essence of it being decentralized and its anonymity factor. Bearing this in mind, is it worth to sacrifice decentralization for protection and regulation by the government? The answer will vary depending on an individual's experience but taxation in cryptocurrency defeats the vision on what Satoshi imagined when he developed this technology.

I guess the phrase 'getting the best of both worlds' is not applicable (at least for now) if we consider these circumstances surrounding cryptocurrencies and the intervention (taxation) by the government.

[Abiky]

I agree with your statement.

There exists a boundary between the taxation of cryptocurrency (which would benefit its users as it will provide a layer of protection and regulation) but it will defeat the very essence of it being decentralized and its anonymity factor. Bearing this in mind, is it worth to sacrifice decentralization for protection and regulation by the government? The answer will vary depending on an individual's experience but taxation in cryptocurrency defeats the vision on what Satoshi imagined when he developed this technology.

I guess the phrase 'getting the best of both worlds' is not applicable (at least for now) if we consider these circumstances surrounding cryptocurrencies and the intervention (taxation) by the government.

Exactly. Taxation goes against what Satoshi intended crypto to be in the first place. A cryptocurrency like Bitcoin was meant to serve as an alternative to the current financial system by eliminating the middleman. Taxing a person's crypto transactions, will make Bitcoin no different than regular Fiat. But I guess that most people will prefer to comply with taxes as they have no other choice. It's better to cooperate with the government instead of going against it. You'll be facing fines or even jail time if you avoid taxes on your crypto transactions.

Since people don't care about the decentralization of crypto and Blockchain technology, they don't protest against crypto taxation. Remember the phrase, "strength in numbers"? If a substantial number of people join themselves together against government-imposed taxes on crypto, they'll stop doing it. But as long as people remain quiet and do nothing about it, governments will continue with the endeavor. One thing for sure is that privacy-oriented coins like Monero and Grin are in real trouble, since it's largely impossible to track & trace transactions for taxation purposes. Only Bitcoin and other cryptocurrencies with a transparent blockchain ledger will survive for the foreseeable future (as governments will approve them in every way).

Nonetheless, I believe that the battle over crypto taxation will be a never-ending one. For once, governments were unable to tax crypto properly. But with the increasing number of centralized exchanges, it's becoming more easier for governments to tax their citizens. The dependency on centralized services by crypto has only made matters worse for the end user. In the bright side, crypto and Blockchain technology will continue to grow in terms of development and innovation. But, it won't be the same as centralizing forces will have a negative effect over people's freedom in day-to-day transactions. Just my opinion

[Averim]

Ever since Bitcoin and other cryptocurrencies became a hit within the mainstream world, governments have been quite skeptical about them. Despite the promise of crypto to bring trustless payments to the world in a frictionless manner, governments have taken every effort to try to prevent its growth worldwide. As of now, centralized exchanges dominate the space where they're subject to KYC/AML laws. There's literally no way to prevent government surveillance except for P2P trading (like Local Bitcoins, etc).

Considering that centralized exchanges serve as gateways from crypto to Fiat (or vice-versa), they've been the targets of governments worldwide. The main concern of governments is tax evasion and money laundering. Sometimes I wonder why governments want to tax our cryptocurrency funds if they're not considered as money by most people worldwide? After all, crypto's nature is a highly unpredictable and volatile one. It seems to me that governments want to profit from this venture more than anything else. Any other cryptocurrency which prevents them from "taxing" people, would be considered illegal to them in the future (like Monero, and other privacy coins).

Which is why, I believe that crypto taxation is more of a problem than anything else. Do you agree with me? What are your thoughts?

Goverments are always in search for money, specially free money so they use every opportunity to get to them and cryptocurrency makes no exception. It is sad the fact that even păaing taxes for crypto it is somehow considered iligal.

[julius caesar]

Unlike any market condition governments always want to profit out of it. When it comes to cryptocurrency, governments suffer a lot to profit out of the same. Even after hard try governments were not able to make things happen perfectly. This is all because of the decentralization of the entire network and people also stay pseudonyms.

The price of the specific item increases because of the tax that is included by the government. If the crypto is allowed to take place on every transaction that we are going to do, the price of a certain item will for surely gonna go down because the tax will be removed since cryptocurrency is decentralized, meaning no one controls it.

[Vishnu.Reang]

Goverments are always in search for money, specially free money so they use every opportunity to get to them and cryptocurrency makes no exception. It is sad the fact that even păaing taxes for crypto it is somehow considered iligal.

That's true, but it is not very easy to tax cryptocurrency. It is not a physical asset and exists only in digital form. So it is very easy for the users either to hide or manipulate the tax burden. Also, the decentralized nature of the cryptocurrency makes it vary hard to track down the users and identify them. And finally, a large part of the transactions take place outside the regulated exchanges, especially in peer-to-peer platforms.

[Twentyonepaylots]

Goverments are always in search for money, specially free money so they use every opportunity to get to them and cryptocurrency makes no exception. It is sad the fact that even păaing taxes for crypto it is somehow considered iligal.

That's true, but it is not very easy to tax cryptocurrency. It is not a physical asset and exists only in digital form. So it is very easy for the users either to hide or manipulate the tax burden. Also, the decentralized nature of the cryptocurrency makes it vary hard to track down the users and identify them. And finally, a large part of the transactions take place outside the regulated exchanges, especially in peer-to-peer platforms.

But I'm sure these people on thw government will find a way to tax cryptocurrency somehow. Moeny is their main leverage and wherever there is money you could see your government hoarding the crap out of it. So I believe that past the decentralized nature of cryptocurrencies and whatnots, they'd still find out a way to charge people for using it. Unless, we find out who Satoshi is, he can put up with this and say that cryptos are something that are of his creation and therefore are not government properties. But this is unlikely. So far though, we don't see any taxations happening yet to any country you guys are right now so let's just breathe in the free cryptocurrency air while it lasts.

I don't see anything bad with being taxed too though. It's much better than having to deal with a ban you know.

[Janation]

Goverments are always in search for money, specially free money so they use every opportunity to get to them and cryptocurrency makes no exception. It is sad the fact that even păaing taxes for crypto it is somehow considered iligal.

I think that is good since if they taxed Bitcoin they will be thrown to jail if that is what you're saying.

I think what you are saying about the government is illegal since taxes should only be used in the country and to support the other two powers of the state. If they are using it for their own good, obviously you can report them. We are still in the time when Bitcoin and cryptocurrencies can't be directly taxed, they might or might not, more importantly, right now it is not taxable.

[Text]

I think that is good since if they taxed Bitcoin they will be thrown to jail if that is what you're saying.

I think what you are saying about the government is illegal since taxes should only be used in the country and to support the other two powers of the state. If they are using it for their own good, obviously you can report them. We are still in the time when Bitcoin and cryptocurrencies can't be directly taxed, they might or might not, more importantly, right now it is not taxable.

The only thing that will look worse is having a high taxation fee than the transaction fee, I hope it will not happen if ever crypto taxation in a county implemented.

Paying a tax using crypto will not be illegal if it has been issued by the government. So who will take the government into jail? Well, if an authority made a mistake of collecting tax like asking a higher amount instead of the exact amount which is not covered by the rules and regulations then you can report them on a higher position because it is considered as corruption. The government's public servants are meant to served not to serve them.

[NavI_027]

The only thing that will look worse is having a high taxation fee than the transaction fee, I hope it will not happen if ever crypto taxation in a county implemented.

I'm sure it won't happen because it was obviously unfair for all of us. If ever a law passed regarding this taxation, I hope they should also follow the guidelines like they used on usual taxing. There's a specific percent should be only deducted on one's total worth and it must be in terms of btc too (disregarding the fluctuation of price).

Paying a tax using crypto will not be illegal if it has been issued by the government. So who will take the government into jail? Well, if an authority made a mistake of collecting tax like asking a higher amount instead of the exact amount which is not covered by the rules and regulations then you can report them on a higher position because it is considered as corruption. The government's public servants are meant to served not to serve them.

This is what I'm worrying about. Since crypto offers more anonymous transactions, corrupt officials can now do their shady stuffs a lot easier than the usual .

[nakamura12]

Government doesn't want any one who will be able to transfer fund to prevent money laundering that is why they create a centralized exchange and make profit because of it. It is more like a tax that you have to pay even if it's a cryptocurrency which we all know there is no tax that we have to pay unless there is government behind it.

[Spaffin]

Government doesn't want any one who will be able to transfer fund to prevent money laundering that is why they create a centralized exchange and make profit because of it. It is more like a tax that you have to pay even if it's a cryptocurrency which we all know there is no tax that we have to pay unless there is government behind it.

in any case, any cash flows should be controlled by the relevant authorities in order to prevent the financing of criminal organizations and criminal activity.  in one way or another, cryptocurrency users will have to come to terms with the fact that they will have to pay the corresponding taxes on their activities, after the cryptocurrency is actually legalized in the respective countries.  But it seems to me that it is likely that the tax will not be levied on storing cryptocurrencies, but on the performance of certain operations, such as cryptocurrency trading.  In this case, taxes will be paid by trading exchanges, and the user will pay a slightly increased trading fee on the exchange.