According to conservative estimates of the Blockchain Center of Frankfurt School (FS) of Finance & Management, German government will incur additional taxes of 726 million € in 2017 through trading in cryptocurrencies. This corresponds to about 1% of total income tax revenue from 2016.
In the coming months, the treasury will benefit from great media attention of Bitcoin. According to current estimate, at least € 726 million in additional tax revenues will be taken for previous year. Basis for this estimate is the amount of all Blockchain based assets in the amount of around € 460 billion in 2017. The share of German investors is expected to be around 3.5%. With average income tax rate of 30%, approximately 726 million euros extra tax revenues, such asFS Blockchain Center has calculated.
Anyone who successfully traded crypto currencies before the turn of the year in the event of enormous price gains, must be very cautious at the latest at the next tax return. Those who do not fully declare their income can make themselves liable to prosecution because of the enormous fluctuations and large profits. According to authors, German state is also responsible for present state of affairs. This was now required to ” create clear framework conditions for the taxation of cryptographic currency gains”.
Problem: As far as tax treatment is concerned, there is still no final legal classification of Blockchain based assets. For many taxpayers this would create considerable uncertainty. With a share of income tax revenue of around 1% from 2016, there is no doubt that there is an ” urgent need for action “.
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Categories: Crypto Currency