Denmark considering proposals to tax unrealized gains on crypto assets
Denmark is considering a wide-ranging crypto tax bill to bring investors into the alternate currency in line with traditional asset holders.
The country’s Tax Law Council has recommended the introduction of legislation to tax unrealized gains and losses on crypto assets held by Danish investors.
The potential new law could commence as early as the beginning of 2026, with a 42% capital gains levy applied.
As part of an extensive 93-page report, the Council set out a recommendation for all crypto holdings to be treated equally, in terms of tax implications.
Three new models were outlined: Capital Gains Tax, Inventory tax, and Loss Write-Offs.
Inventory Taxation would mean investors are required to pay taxes on their entire portfolio by a set date each year, even if they don’t sell any assets.
Capital Gains Tax would introduce a 42% levy on unrealized crypto profits, mirroring Denmark’s approach to traditional assets.
Loss Write-Offs would act as an antidote to the tax increases, with investors able to write off losses on gains, in line with ‘regular’ asset investments.
The proposal seeks to simplify the tax system and mirrors the approach of Italy which increased its taxes on gains from 26% to 42%.
If the bill is approved, it would mean Danish citizens would be required to pay liabilities on Bitcoin or other crypto assets from the day of purchase, regardless if the holdings have been sold or not.
The outcome of this means holders would be taxed for their entire portfolio, including unrealized gains.
https://twitter.com/BitcoinNewsCom/status/1849191905570984201
Plans inspired by desire for “more reasonable taxation”Denmark’s tax minister Rasmus Stoklund commented on the ‘fairness’ of streamlining the system.
He said, “Throughout recent years, there have been examples of Danes who have invested in crypto-assets being heavily taxed. The council’s recommendations can be a way to ensure more reasonable taxation of crypto investors’ gains and losses.”
Such a change would represent a significant upheaval for Danish investors, but some relief could be provided with the ability to write off certain losses, as is the case for conventional investors.
The Tax Council added that the bill would also compel crypto asset service providers, exchanges, and payment platforms, to “report information about their customers’ transactions” in a way that would be open to all European Union member states.
This would aim to increase transparency and reduce crypto tax evasion within the sector.
Image credit: Via Ideogram
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