To address the issues created by Bitcoin and other cryptocurrencies, Denmark’s tax minister wants to alter the country’s existing tax code.
According to a report from local media site Berlingske Tidende, the Danish Tax Agency identified over 16,000 persons and firms involved in bitcoin trading between 2015 and 2019.
However, according to the country’s tax minister, Morten Bdskov, up to two-thirds of all transactions completed during this time period were not correctly disclosed in tax filings.
According to Bdskov, this is partly owing to Denmark’s out-of-date tax system, which was enacted in 1922, when no one could have predicted the rise of new financial instruments like cryptocurrencies. The purpose, according to the minister, is to “ensure that our rules are current and limit errors and fraud.” “The crypto space is a good illustration of such an area,” Bdskov continued.
Because of the large number of non-professional investors, the Danish Tax Law Council, an independent committee that is now reviewing the existing rules, “the rules should be clear and transparent” and not leave room for possible misunderstandings and, as a result, errors in tax assessment, according to the Danish Tax Law Council.
Any changes to the existing rules, on the other hand, will take time.
By mid-2023, the Tax Law Council must submit a draft proposal for legislative revisions, so it will be several years before Denmark’s tax regulations are adapted to tax gains and losses on cryptocurrency trades.