Government Taxing Bitcoin? Here's the Answer

[iram3130]

That is one of the major reasons for governments to not make crypto a legal tender. They think people will find ways to not pay taxes and there are people who do this. I just pay the tax according to what I have withdrawn or sold crypto for my local currency and thats how it should be.

[AjithBtc]

There is a lot of ways of imposing a tax for the government's rising fund which is used for the expenditure for maintaining a state properly, I think only BTC is not their headache, Another thing is that, If Bitcoin would be included in the tax system then what is the problem, I don't see any problem at all, We are giving Foreign exchange when we convert BTC into USD and Covert into local fiat, so we have already given to them, so there should be a proper system which only once imposes tax for using BTC or Cryptocurrency, I think it's not a difficult thing anymore.

Every government tax based on the holdings we've got. This can be property, assets, shares, stocks and other valuables (Gold, bonds, policies). Here Governments find it easy to have every information added to their database as everything is centralized and subject to provide information to the government. With bitcoin and other cryptocurrencies information on holdings of people can't be found exactly until the person himself discloses. This way taxing of bitcoin isn't easy.

[Amel]

Your idea is very good but in my opinion it is very unresponsive to every tax need. In fact, we not only pay taxes when sending goods or make transactions at banks but there are many types of taxes that need to be paid such as house tax, vehicle tax, etc. And it cannot be adjusted to a local exchange when transacting.

On the other hand, it means that we must always pay taxes when making exchanges or trading, of course it will be expensive especially if added to the fee.

[gweedo]

To be honest, I don't know how the government applies tax for bitcoin, but I am sure that they can do that because they will know people who already use crypto by checking on the bank account. They will search for the account who made a big transaction in a month, and I think they will try to ask that people about the money they sent. But maybe that will be related to the KYC that every exchange did for their members so the government can check one by one of the members so they can get the name of the people.

It's hard to know who uses cryptocurrency through checking bank accounts. I think the best idea is that they will create an exchange in their country and ask people to use it, then they can easily track and tax it as accurately as possible. But honestly no one can tax this market, it's really hard

[bitvalak]

There are already several countries that have local exchanges.
This should not be a problem because the owner of the exchange must have paid taxes on the exchange business.
Because every country must provide tax for those who have a business license.

[Ozero]

To be honest, I don't know how the government applies tax for bitcoin, but I am sure that they can do that because they will know people who already use crypto by checking on the bank account. They will search for the account who made a big transaction in a month, and I think they will try to ask that people about the money they sent. But maybe that will be related to the KYC that every exchange did for their members so the government can check one by one of the members so they can get the name of the people.

It's hard to know who uses cryptocurrency through checking bank accounts. I think the best idea is that they will create an exchange in their country and ask people to use it, then they can easily track and tax it as accurately as possible. But honestly no one can tax this market, it's really hard

The state can create local cryptocurrency exchanges. However, the terms of trade on them must be acceptable. Then people will be happy to use local exchanges. However, the government is unlikely to be able to exchange all types of existing cryptocurrencies. Now even the largest exchanges can not afford it. Therefore, at present, this idea is unlikely to work. Maybe in the future, exchanges will be able to automatically work with all types of cryptocurrencies. After all, the current exchange system for trading cryptocurrency, in my opinion, is very imperfect.

[Shasha80]

This is the reason why some countries do not legalize bitcoin, but also do not prohibit its citizens from using bitcoin. Because
The government of that country already gets tax from local exchanges, so it's not surprising that almost all local exchanges
require users so to do KYC. So the government can get tax from every user to withdraw bitcoin to the bank to convert be fiat.
Because for countries that have not legalized bitcoin, it is still forbidden to use bitcoin as a payment. So from that for its citizens
inevitably have to convert bitcoin that is owned into fiat, then inevitably also users of bitcoin have to pay tax.

[Reatim]

You didn't solve the government's taxation, you only made it simple! because as long as there's a centralized third party that is handling the information of the user and the connected wallet to him/her, then the government can do whatever they want.

In my opinion, the only way to avoid taxation is to use decentralized third parties like exchanges. That way, they can't track your earning as long as you don't report it.

But i don’t think we really need to avoid taxation? This is what i am asking for long time since we are profiting from this market,what is the main reason why people that getting money from something is wanting to be free from taxes?

And besides this is the only way for crypto to finally hit the top,but first we must be aware of the coming KYC if this taxing implemented .

[killerfrost]

I don't understand why governments in the world want to tax this market, this is a decentralized market so no one will be able to manage and control all the transactions and actions of the investor. Up to now, I have not seen a country that has been successful in taxing investors. Korea and Japan have investor tax policies but it is not really thorough,  there are still holes

[samcrypto]

I always wonder how could an economy operate and run without taxes from cryptocurrencies. How could a government obtain taxes from people when people are completely utilizing a currency that is not supporting taxes. Would it be really good if we completely have our fiats converted to crypto? For me, there's always a way if our intention is good. We cannot really deny how government is providing regulation that is mainly for the betterment of us despite of some issues regarding corruption and frauds.

For me, the way we could still make it possible is to establish a local exchange wherein, if we convert our money to crypto, these local exchange could already have the portion intended for the tax of each transactions.

That can be more possible to collect taxes from a crypto users and government really need to regulate exchanges not just for taxes but also for the protection of every users. I’m ok with taxes, I’m ok for its purpose but I don’t fully support the corrupt politicians and government. Cryptocurrency can be better, it should be supported by every government and their people will be more active financially.

[buwaytress]

I think that it's justified to treat cryptos for tax purposes the way fiat currencies are treated. Normally it means only income tax. In my country the legislation is tricky with two different ways and amounts to pay depending on the type of business. Anyway, there are countries with reasonable progressive tax system which even allows people with very small income not to pay anything.
There are also small states which are tax-free, and some zones for crypto businesses that allow not to pay taxes or not to pay a lot for a while.
The exchange idea is also nice. It's kind of like we all pay VAT which is embedded into the prices of goods. Easy and useful.

I'll never understand why people are so against giving what's due. I do agree and get in that tax in my home country is annoyingly unfair, since a lot of it ends up in corrupt hands. But it doesn't prevent me from paying my dues. You want to live in a country, enjoy the privileges and rights, and expect reasonable public services and amenities, then you have to do your part and support it.

I do like the idea of VAT too. Everything priced in. People in my country are all angry about it but come on, suck it up and pay for it. Or go find a tax free country. Or live off grid.

[crzy]

If there’s no law about this one then government can’t collect taxes, regulation should be made first and if those exchanges really want a good business then they should follow the law. Tax is a must in my country, its sad that even big people are not paying the right taxes, the law should be implemented well and everyone should require to pay whether you’re rich or not.

[Reid]

Yes, that is the answer.
We keep our privacy and then the local exchange will provide for the government to keep on making money for the improvement of infrastructures and anything that is paid by the people taxes.

That is, if the local exchange will be faithful with it.
Now, it is still a risk they should be willing to take.
Bitcoin moves like crazy in price and when people keep on withdrawing funds they might also get bankrupt by it.
Needs a lot of support also from the government for their service to be used.

[bettercrypto]

I always wonder how could an economy operate and run without taxes from cryptocurrencies. How could a government obtain taxes from people when people are completely utilizing a currency that is not supporting taxes. Would it be really good if we completely have our fiats converted to crypto? For me, there's always a way if our intention is good. We cannot really deny how government is providing regulation that is mainly for the betterment of us despite of some issues regarding corruption and frauds.

For me, the way we could still make it possible is to establish a local exchange wherein, if we convert our money to crypto, these local exchange could already have the portion intended for the tax of each transactions.

Deregulation sometimes is a bane. In terms of economic growth, taxes are the most helpful way to fund the government. To maintain and stabilize the countries uncountable needs, taxes is really needed. But due to the graft and corruption, the treasury fund will always be corrupted by politicians. They used it to buy their own things instead of funding a project that helps to boost the industry. And crypto is an answer to that question. We don't need to eliminate tax, we need transparency.

[aomakun]

If there’s no law about this one then government can’t collect taxes, regulation should be made first and if those exchanges really want a good business then they should follow the law. Tax is a must in my country, its sad that even big people are not paying the right taxes, the law should be implemented well and everyone should require to pay whether you’re rich or not.

tax becomes one of the state's revenues to develop their country, and I think if the state does tax collection then they make a new regulation and in this context we must first look at the legality of crypto. You are right because without legality the state cannot take taxes on crypto users, except the company tax.

[Gotumoot]

Actually here in my country not paying tax for bitcoin holding is crime and you will give penalty for not paying tax and the worst is to be jailed.  But Goverment here in my country don't have enough knowledge on how they can implement tax from us especially they don't know how to track me or my other friends. 

[airdnasxela]

All of us are responsible for paying taxes. And we'll only pay tax of cryptocurrency becomes officially legal in your country. As for my country, it's not yet legal that's why there's still no specific law about tax. Your idea is nice, the government just need to legalized it so they can implement taxation. But you know, people who have more income are more afraid of taxes, they'll make way just to lessen tax they would pay. This is also possible in crypto, if implemented.

[carlzec]

States would not demand tax on bitcoin. They officially declare the existence of Bitcoin if they require a tax on profits from Bitcoin. In this case, the number of businesses that accept bitcoin increases. And people start trading in bitcoin province. These are my ideas.

[johant123]

Here crypto currencies are definitely taxed. The exchange I am using even sends you a yearly report of your assets, to use for your tax filings. And if they can send it to you, they can also give it to the tax authorities on request.

I don't know about all EU countries, but it looks to me like they are accepting crypto currency, and taxing them as they do other assets (like gold, or stocks).

[rekinthis]

Here in our country our wallet is regulated by the government in some ways so there's a fees behind that like the permit or license of our wallet but not every transaction then i think that's really a little only like very affordable so no problem at all then if your account is regulated but not good like with KYC and high fees then better to find other

wait what? your country government has actually a way to monitor all of your bitcoin transactions? How is that done and which country do you live in? In my opinion, it's a crime to do such things by the government because every person should have the right to privacy. It is crazy how governments themselves do not respect the peoples rights.