Has this government gone crazy? It doesn't recognize the asset properties of cryptocurrencies, but requires taxes on profits from them -.-???

The Ministry of Finance of Taiwan’s report on the taxation regulations for cryptocurrency income has been released, but it has aroused widespread dissatisfaction among the public. The taxation standards are unclear and have caused public resentment on the Internet. Many people question the Ministry of Finance and the Financial Supervisory Commission’s separate policies and chaotic policies. Experts have called for the implementation to be suspended. , and enact special laws to protect the rights and interests of the people. (Preliminary briefing: Taiwan’s cryptocurrency “taxation regulations” were released, and the National Taxation Bureau investigated that tax evasion by selling coins in 2024 amounted to 130 million) (Background supplement: Do cryptocurrency investors need to file a tax return? What are the differences between domestic and foreign income, virtual currency losses Can losses be recognized?) The Ministry of Finance has released a written report on "Taxation Regulations on Cryptocurrency Income" submitted to the Legislative Yuan, standardizing the taxation of income from virtual currency transactions. Virtual currency transactions must be subject to current tax laws based on "whether they have the nature of securities" , the taxation regulations are explained as follows: If an individual or enterprise buys or sells virtual currencies of a securities nature, their trading profits and losses are classified as "securities trading profits and losses" in the Income Tax Law. Currently, Taiwan has stopped collecting income tax, but companies still need to include this part of their profits and losses in the calculation of basic income in accordance with the (Basic Income Tax Ordinance). Non-security virtual currency Individuals: If there is no regular transaction (not clearly defined), the income is classified as "property transaction income" in the Income Tax Law. The taxation method is: the balance after deducting the purchase cost and related expenses from the transaction price is incorporated into the calculation of comprehensive income tax. Enterprises: Profit and loss should be calculated in accordance with the provisions of the (Income Tax Law): reduce relevant costs and expenses from income, incorporate the income into income from profit-making enterprises, and tax in accordance with the law. The Ministry of Finance pointed out that there are currently two major ways to conduct tax inspections. The first is that the regional taxation bureaus list individuals or profit-making enterprises using virtual currency online trading platforms (exchanges) to conduct transactions on the two major exchanges as inspection items. According to the notification and Collect information, check relevant information and transaction details by letter, and then determine income and pay taxes based on the information found. The second is that in order to truly grasp the tax sources and curb tax evasion, in addition to using existing tax data collection methods, various regional tax authorities will also continue to review and optimize data collection methods and scope based on emerging transaction types to improve audit efficiency. Taxation in accordance with the law. Taxation regulations arouse public dissatisfaction. However, after the taxation regulations on cryptocurrency income were released, public dissatisfaction quickly aroused on the PTT. Many people criticized the government's unclear taxation standards and too hasty implementation methods, and even questioned the lack of coordination between the Ministry of Finance and the Financial Supervisory Commission. , leading to confusion in the definition and taxation standards of virtual assets. First of all, there is a disconnect between the Ministry of Finance’s taxation regulations and the Financial Supervisory Commission’s regulations on virtual asset management, which has caused confusion among many people. The Financial Supervisory Commission’s management of virtual currencies is limited to financial supervision and cannot interfere with the Ministry of Finance’s taxation policies. This has led to virtual asset Different ministries may have different definitions and handling methods, leaving the public at a loss as to what to do. Secondly, according to the regulations of the Ministry of Finance, people need to calculate their own income from cryptocurrency every year. Even if the virtual currency has not been converted into legal currency (no money has been withdrawn), they may have to declare and pay taxes in accordance with the regulations. If they fail to declare, it may be regarded as tax evasion. This behavior has made many netizens question that it will be difficult to accurately calculate income. One netizen said: There is no asset in the world that is subject to income tax before being exchanged for the country's legal currency, so the government must be looking at where you deposited the money and where you made the deposit. When withdrawing money, calculate the total amount in Taiwan dollars. Otherwise, will I be able to pay doge or sol when paying taxes? But here comes the question. Suppose I deposit 1 million in a certain year and then make money, so I withdraw 110,000 every year. How do I calculate this? In this way, even after 9 years, my costs still have not returned to zero. Maybe I will lose them all in the last year. I have not made any money and still lose money. What income tax will you charge me? In addition, for investors who hold multiple cryptocurrencies at the same time, there are no clear regulations on how to deal with the issue of mutual gains and losses. For example, if you lose money when investing in Bitcoin, but make a profit in Dogecoin, how should you declare such a situation? Can profits and losses be offset? The Ministry of Finance has not provided a specific explanation, which may lead to the tax base determination standard being too subjective and putting the public at tax risk. The Ministry of Finance has not clearly stated whether short-term investment assets obtained through Web3 wallets or cold wallets need to be declared. People are full of doubts about whether such non-trading income falls within the scope of declaration, and are worried that they may be pursued in the future due to unequal information. taxes. The policy lacks support and communication and should be promoted. Experts point out that cryptocurrency taxation policy is extremely complex. Taiwan has not yet enacted special legislation for the taxation of virtual assets. Although the Ministry of Finance mentioned relevant research in the report, it did not refer to it. International trends, and no public hearings have been held to listen to public opinions, resulting in policies that are out of touch with people's livelihood and increasing people's distress. It is recommended that the government should postpone the implementation of taxation policies, collect opinions extensively, and formulate more complete tax policies with the goal of enacting special laws. tax system. Extended reading: Central Bank: Taiwan has not considered including Bitcoin in its foreign exchange reserves. Peng Jinlong predicts that a special law on virtual assets will be sent to the Legislative Yuan in June next year. Related reports: Buying Bitcoin in Hong Kong will require you to file a tax return! The government promises to implement the "Crypto-Asset Declaration Framework" and complete legislative revisions within two years. Article by Lawyer Shanglun) How are crypto-assets taxed in Taiwan? Answer 5 big questions in the currency circle and determine the future from the current tax system. Taiwan’s first case) A personal currency dealer in Kaohsiung was arrested for buying and selling USDT. Is it possible that privately trading cryptocurrencies will violate the law? "Taiwan's cryptocurrency tax has caused public complaints that "you have to declare even if you haven't withdrawn the money." Are the Ministry of Finance and the Financial Supervisory Commission each doing their own thing? "This article was first published in BlockTempo (Dong District Dongzhu - the most influential blockchain news media).