Is this reasonable?

[Zigabel]

From your post OP I think the government  brought about all of that in the bid to have some levels of control over the crypto market in the Philippines even if they don't get complete control but to a great extent  they get to make revenue off the existence of it in their country through  tasking  hence they will be able  to account  for the number of persons involved in crypto trading and investment in their country and possibly  regulate them based off the taxing.

They can also make some form of implementations if they get to know  the exact volume of trade been executed by people in the Philippines,  all of this for me is just  a system to effect some sort of control and at same time make it of a complete direct economic benefit to the country so it makes sense in a way and doesn't in another way as the freedom crypto has promised may be threatened by that.

[Cryptomultiplier]

Do The Philippines consider stock, ETF, precious metal, real estate as a legal tender? if a country accept Bitcoin regardless in any "form", you high likely need to pay taxes except the country declare crypto is tax free.

Honestly I think if a country accept Bitcoin as a legal tender and you use Bitcoin to purchase something, it's no longer need to be taxed. Because we need to treat Bitcoin is same to fiat, people only get taxed when you get paid, not when you purchase something.

But, in your article, there was written "The tax applies to profits made from selling or exchanging cryptocurrencies and purchases made using crypto.", so they will tax everything.

You are right with your expression and that is cryptocurrencies even if they get taxed, should be taxed only when payments is received not when it is used for purchase. Afterall, Fiat isn't taxed when we get to use it to make payments but rather when we receive it as salary or wages or some kind of income for services rendered.

I must say it is rather unfair for the Philippines government to be imposing taxes when a world power like the U.S is removing tax return on crypto currency so as to give it the power of purchase that Fiat has currently.

[Z-tight]

I must say it is rather unfair for the Philippines government to be imposing taxes when a world power like the U.S is removing tax return on crypto currency so as to give it the power of purchase that Fiat has currently.

I don't know where you have seen this information, did Donald Trump tell you that, lol. Crypto is very well taxed in the U.S. and there is no consideration of removing it. In the U.S. you can pay taxes on crypto up to 37%, depending on how long you have held your coins and other factors that i don't want to get into now. Crypto is not only taxed as capital gains in the U.S. but there is also a crypto income tax in the U.S.

[FatFork]

Why should you pay taxes on something that's not officially money? Well, governments like to get their share, no matter where it comes from. Even if Bitcoin or crypto isn't "official" money, if you make money from it, they'll want a piece of it.
And I don't think it's necessary to be legal tender... because, honestly, it's about the money you "earned" from price appreciation, not just what kind of asset it is.

[GiftedMAN]

You can only hope that the tax from cryptocurrency can be used to developing the country and in the right reason.

Personally I don't think I will be going against the rule of law in respect to tax payments in my country if need be and I doubt if I will even have their time to know if they are going to be using the money gotten from tax payments for the development of the country but my questions here is this, how will the amount for tax be calculated when the government doesn't approve cryptocurrency transactions in my country? Will I just do the calculations myself and send in any amount of what do you suggest because I think this will be another trap to capture cryptocurrency traders  and who knows if they will end up freezing their accounts after discovering the number of tax payers from cryptocurrency don't you think so.

[Z-tight]

Why should you pay taxes on something that's not officially money?

That is because the 'tax collectors' view cryptocurrency as an asset or property, and just as you pay taxes on the gains realized on the sale of any asset, i.e. shares of company, we have to pay tax on the gains realized on the sale of our BTC. However, it is crazy how high some countries tax crypto gains, i have a feeling that some of them do it to discourage their citizens from using BTC and such a move is regressive.

[nullama]

~snip~
That is because the 'tax collectors' view cryptocurrency as an asset or property, and just as you pay taxes on the gains realized on the sale of any asset, i.e. shares of company, we have to pay tax on the gains realized on the sale of our BTC. However, it is crazy how high some countries tax crypto gains, i have a feeling that some of them do it to discourage their citizens from using BTC and such a move is regressive.

The thing is that in most cases Bitcoin tax from gains, basically capital gains, are treated exactly the same as any other asset, as you say, like stocks, index funds, etc.

This means that also all the benefits apply as well. For example some countries give a discount on capital gains tax if you hold the asset for at least a year. Some countries offer a 50% discount, like Australia, whereas others like Germany give you a full discount of 100%.

Yes, in Germany they don't have capital gains tax if you held the asset, Bitcoin for example, for at least a year.

[Solosanz]

That’s a different type of income, so it can’t be used as a justification. what we’re specifically talking about here is capital gains tax and it’s important to understand that you only realize a gain when you sell... meaning not crypto-to-crypto transactions, but crypto to fiat.

for example, if you buy Bitcoin at $70K and later sell it for $100K, your profit is $30K.

Since you’re required to pay 15% in taxes, your tax due would be $4,500.

Man, I already know it's different type of income.

Please read your post again, you said it's possible to evade taxes, then I'm just explaining how it's possible to evade taxes when everything is recorded on your banks statement.

So let's say you have a job and get paid for $5,000 per month, you get paid every month.

January 5, credited $5,000
February 5, credited $5,000
March 5, credited $5,000
...
December 5, credited $5,000
December 20, credited $20,000

My question, will you report $60,000 or $80,000 to the tax authority? $20,000 is money from cryptocurrency.

[betswift]

Why should you pay taxes on something that's not officially money?

That is because the 'tax collectors' view cryptocurrency as an asset or property, and just as you pay taxes on the gains realized on the sale of any asset, i.e. shares of company, we have to pay tax on the gains realized on the sale of our BTC. However, it is crazy how high some countries tax crypto gains, i have a feeling that some of them do it to discourage their citizens from using BTC and such a move is regressive.

It's about money for them, not about adoption, so it's obvious it would discourage many and make others just angry at such a decision.

[fuguebtc]

I must say it is rather unfair for the Philippines government to be imposing taxes when a world power like the U.S is removing tax return on crypto currency so as to give it the power of purchase that Fiat has currently.

After Trump became president, he signed an executive order removing all capital gains taxes on US-based cryptocurrencies. His aim in issuing this executive order is to attract more developers and investors to the domestic market and make the United States the center of the cryptocurrency industry. But there is no guarantee that when they achieve their goal, they won't change the laws to tax crypto again because that's how government works, the US is no exception. Not to mention, Trump's term is only 4 years and things can be reversed when another president takes office so don't praise the US government just because they temporarily exempted crypto from taxes. Also, don't be naive to think that cryptocurrencies will be treated the same as fiat.

[GideonGono]

~snip~

~snip~

If you are not using any local crypto exchange, I don't think you should be declaring your crypto assets at all. But if you are already using a local exchange, then you data is already available with the government. So if you don't declare, you may receive a tax notice. I will suggest you to speak to a professional tax lawyer to understand the situation in a better way and decide accordingly. 

For me I see it as a trap, how would they know how much crypto you hold if you wouldn't even give it to them.
It would be hard for them to track every crypto wallet and impossible to know who owns it, if the owner wouldn't provide any proof of ownership, just like how we still couldn't know who created Bitcoin.

[Jawhead999]

For me I see it as a trap, how would they know how much crypto you hold if you wouldn't even give it to them.
It would be hard for them to track every crypto wallet and impossible to know who owns it, if the owner wouldn't provide any proof of ownership, just like how we still couldn't know who created Bitcoin.

It's almost impossible to find someone identity if they hold their coins in wallet and they only trade using no KYC exchanges. But the question is, are you okay to keep holding most of your coins and never cash it out?

You also shouldn't buy lambo, house or something expensive because it would raise a suspicion how can someone buy expensive thing when their taxes are small.

[Mpamaegbu]

In my country, the Philippines, crypto owners are urged to declare their crypto capital gains for annual tax filing. This means that we are urged to pay taxes, and I don't think this is reasonable enough since crypto was not yet considered a legal tender.

In a way, your government has officially recognized cryptos and not criminalize it like the case in my country. It's a plus for you guys. In my case, as it stands now, I personally don't even know the exact position of my government on cryptos. It's either police is harassing poor people who are into cryptos on the road, searching their phones and threatening them of breaking a law they the police can't cite once they find any crypto app or stuff on such phones or banks are banning accounts with crypto related words during transactions. It's a gamut of confusion. Even with all that, Nigerians still pay tax on trading transactions on exchanges that are still allowed to do business with Nigerians. They may claim it's just a fraction as tax but then it's still something.

[SquirrelJulietGarden]

In my country, the Philippines, crypto owners are urged to declare their crypto capital gains for annual tax filing. This means that we are urged to pay taxes, and I don't think this is reasonable enough since crypto was not yet considered a legal tender.

You have to do this, include your capital gain in tax report if you are a citizen in Western countries where Bitcoin and cryptocurrency are not legal tender. This example means your country is not an exception in tax policy and capital gain from cryptocurrency.

In a way, your government has officially recognized cryptos and not criminalize it like the case in my country. It's a plus for you guys. In my case, as it stands now, I personally don't even know the exact position of my government on cryptos. It's either police is harassing poor people who are into cryptos on the road, searching their phones and threatening them of breaking a law they the police can't cite once they find any crypto app or stuff on such phones or banks are banning accounts with crypto related words during transactions.

If you don't do criminal activites and are under radars of police to arrest you anytime, I see it's logically that police has no reason to stop you on the street, access your phones just to find whether you own bitcoin or cryptocurrency. A nation like this likely have dictator and no effectively reasonable law at all. So that police can abuse their rights and power to do anything they want like you described.

It's almost impossible to find someone identity if they hold their coins in wallet and they only trade using no KYC exchanges. But the question is, are you okay to keep holding most of your coins and never cash it out?

You can do it with no KYC exchanges.
https://kycnot.me/?t=exchange

[AmoreJaz]

~snip~

If you are not using any local crypto exchange, I don't think you should be declaring your crypto assets at all. But if you are already using a local exchange, then you data is already available with the government. So if you don't declare, you may receive a tax notice. I will suggest you to speak to a professional tax lawyer to understand the situation in a better way and decide accordingly.  

For me I see it as a trap, how would they know how much crypto you hold if you wouldn't even give it to them.
It would be hard for them to track every crypto wallet and impossible to know who owns it, if the owner wouldn't provide any proof of ownership, just like how we still couldn't know who created Bitcoin.

If you look at this situation, you can declare what you have thru your local exchange. Other crypto transactions outside your local exchange may not be compulsory to declare in your tax filing. As they won't know all your crypto transactions, it is none of their business unless, you disclose it to them.

As the local exchange is under the jurisdiction of the Central Bank, they surely have your data or info about crypto dealings. Now, you can easily check how much you have if you will go to your Withdrawal history as well as your deposits. So if it is mandatory to declare those earnings, you really need to as you can't escape because they already have your record.

Otherwise, need to consult a tax lawyer if we are talking big numbers here. Within your jurisdiction, they have the upper hand knowledge on how to go around these things but still following your local tax regulations. Better abide the rules rather than suffer the consequences later on.

[d5000]

I'm a bit late here but I still wonder why so many people still are confused about the concept of a "legal tender".

Legal tender is an official currency, normally one every merchant in the country has to accept. This has nothing to do with "legality" of an asset.

It has to do, however, with the ability to be taxed. It should be the other way around as the OP supposes, as was already written here:

If Bitcoin was legal tender in your country, then "gains" (i.e. when your holdings are worth more in another currency like the USD) would very likely not be taxable, because it would be considered a transactional currency, not a valuable or speculative asset.

If you "invest" a lot of money in your own country's currency because you think it will go up against the USD or the Euro, then you won't have to pay taxes on that "gains" either.

[Smartprofit]

In my country, there is no capital gains tax (capital gain is defined as the increase in the price of Bitcoin, expressed in fiat currency, at the end of the reporting period). Accordingly, there is no obligation to declare and pay such a tax.

At the same time, in my opinion, any tax should be reasonable and economically justified. In this situation, we are dealing with an income tax (income is the economic benefit of the taxpayer). If taxes in the country are paid in fiat currency, then taxable income should also arise in fiat currency.

However, if I do not sell my Bitcoin, then, in my opinion, I have no taxable income (no economic benefit arises). I consider the capital gains tax on the first cryptocurrency to be a discriminatory tax aimed at hindering the development of Bitcoin.

This looks even more cynical if you remember that governments of states until recently did not recognize Bitcoin as something significant. They called it a bubble and a scam.

[Z-tight]

However, if I do not sell my Bitcoin, then, in my opinion, I have no taxable income (no economic benefit arises). I consider the capital gains tax on the first cryptocurrency to be a discriminatory tax aimed at hindering the development of Bitcoin.

That is exactly how it is, capital gains tax is paid when you have realized profit on your BTC holdings, i.e. you buy BTC today and sell it after sometime, if you have made profit within that time, your profit is subjected to capital gains tax. You don't pay taxes when you haven't sold your BTC or when you haven't spent it with merchants that accept BTC as payment.

[Doan9269]

In my country, the Philippines, crypto owners are urged to declare their crypto capital gains for annual tax filing. This means that we are urged to pay taxes, and I don't think this is reasonable enough since crypto was not yet considered a legal tender.

Crypto regulation in the Philippines is in a quasi-legal state as of now. It is not yet accepted completely, nor has been completely outlawed. Cryptocurrency transactions are legal in the Philippines , however, the crypto coins are not considered “legal tender”.

The Philippines government has implemented a capital gains tax of up to 15% on cryptocurrency transactions to regulate and tax the growing crypto market. The tax applies to profits made from selling or exchanging cryptocurrencies and purchases made using crypto.

source: https://coinpedia.org/cryptocurrency-regulation/cryptocurrency-regulations-in-philippines/

I'm not sure if this is also happening in your country. Is anyone honest enough to declare his/her crypto assets? For me, taxes should be considered ONLY if it is officially accepted and become legal tender.

Our government can come in by any form as long as it involves payment of money for them, they often rake series of attacks on bitcoin because they don't have the ability and capacity of controlling the people as well as their assets in crypto, but through this, they have just got you apprehended using other means, If i were you, am going to be very careful of using a crypto exchange in that country and try to maintain privacy for my own good, any centralized institution will not be safe for use by any crypto minded individuals because they can be traced by the government.

[Ultegra134]

That is exactly how it is, capital gains tax is paid when you have realized profit on your BTC holdings, i.e. you buy BTC today and sell it after sometime, if you have made profit within that time, your profit is subjected to capital gains tax. You don't pay taxes when you haven't sold your BTC or when you haven't spent it with merchants that accept BTC as payment.

That is correct. You're not going to get taxed as long as you haven't sold your Bitcoin. Whether we like it or not, Bitcoin has become a mainstream subject the past few years, and especially now that it has surpassed $100,000 in value. It's logical for governments to try and earn money through the taxation of capital gains from cryptocurrencies; it would happen eventually. Nobody likes paying taxes and having the government as a partner, taking a cut of up to 15%. Screw them, but I don't believe we can avoid it forever.