Finance Criticises Proposed Cryptocurrency Tax

By , 31 Aug 2021, 12:31 PM Business
Finance Criticises Proposed Cryptocurrency Tax

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STA, 31 August 2021 - The newspaper Finance approves of imposing a tax on earnings from cryptocurrencies in Tuesday's commentary, but lambastes the Financial Administration's proposal for a 10% tax on the sale value of cryptocurrencies as being unreasonable.

The paper says there are several arguments in favour of taxing the crypto market, however the direction which the Financial Administration is taking with its proposal is "completely misguided".

"They want to tax 10% of the sales value of cryptocurrencies. This means that if you buy 1,000 euros' worth of Bitcoins and later sell them for 1,100 euros, your profit is 100 euros and the tax 110 euros."

Calling the idea unreasonable, the paper says trading in cryptocurrencies is much like trading in securities; no one buys them to use them as a currency and everyone buys them to sell them for a higher value later on, so there is no reason for traders not to pay tax on capital gains, at the same rate as investors in shares.

The paper says the state has been sending out a wrong message by not taxing trading in cryptocurrencies so far and is sending a wrong one now with a proposal that in many cases means state 'confiscation' of all or almost all profit.

"Since nothing is as bad as it seems let us hope the Finance Ministry will see reason and draw up a normal proposal - so that cryptocurrencies are taxed by profit, just like shares."

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