The Polish government is facing heavy resistance from locals after it launched new taxes over crypto income, stated bitcoin.com. The Finance Ministry of Poland is being criticized by the local crypto community which has launched an online petition for gathering mass support. It is estimated that taxes on crypto generated income can go as high as 32 percent. Every transaction will be taxed as a transfer of property rights without consideration of the end result.
The department made it clear that tax returns of Polish citizens should include all the crypto related information. The income generated through crypto trade will be included in personal income and will be taxed accordingly. A progressive income tax scale has been implemented by the Poland government with two tax scales- 32 percent on those that exceed the limit of 85,528 zloty (Euro 20,400) and 18 percent for those who do not reach this limit.
As the government acknowledges crypto trade as a transfer of property rights, it is subject to 1 percent tax rate concerning the governing civil law agreements. The authorities want to tax crypto transactions even if the end result was not in favor of the seller. Even if Poles do not make profits on their transactions, they will have to pay this tax to the collectors. This is the primary reason for the polish crypto community to march against the authorities.
According to the crypto traders, the government is killing the growing digital currency market. Tax regulations have been imposed without discussion with the crypto community. The petition holders demand the cancellation of all the taxes and new rules to clarify the taxation of profits over crypto dealings.
It states, “The current interpretation of the tax regulations in regards to cryptocurrencies require market participants to pay 1% tax on each transaction. After a hundred transactions, regardless of the market situation, investors could have given all their capital to the state. As a cryptocurrency community, with over 250,000 active members, we oppose these obligations.”
As of now, 3000 people have signed the petition, and many blockchain based polish companies have considered foreign projects. Protestors say, “They want to take 1% of each transaction but will not get a penny”, the campaign says. The petition has been signed by almost 3,000 people (at the time of writing).
The government is now working on a more convenient taxation system but also announced that current regulations are binding. April 30 is the last date to file the annual tax returns in Poland.
Unlike Poland, South Africa has asked for inputs from the crypto community to tax the income and losses from crypto trade. CCN.com reported that Tax agency of South Africa puts crypto related income under normal tax rules and it can also be liable for capital gains tax.
Governments all around the globe are trying to tax crypto trades but are not getting healthy support from crypto investors. Countries like India are coming up with their own fiat cryptocurrency known as Laxmi. It would be interesting to see the outcome of the taxation policy launched the Polish authorities.