- The President of the United States, Donald Trump has recently proposed a tax cut for the crypto industry.
- Now, this has potential to be extremely exciting for the overall sector.
The President of the United States, Donald Trump has recently proposed a tax cut for the crypto industry. Now, this has potential to be extremely exciting for the overall sector.
Trump spoke in a news conference earlier this week but he said that the administration for his presidency was seriously considering a capital gains tax cut. He said:
“We’re looking at also considering a capital gains tax cut, which would create a lot more jobs.”
However, like most of Trump’s conferences, there is a debate of the extent of his ability to deliver these kinds of cuts. The long-term capital gains rate of 20% is typically looked over by Congress. This means that if he was to deliver such a cut in taxes, he would need to get lawmakers and regulators on his side through negotiation.
For the United States, taxation is a pretty big deal that is harder to govern. Many Americans are required to report their gains and losses on each transaction, especially when it comes to Cryptocurrency. Even if they have not made a profit, they will need to report their trading activity.
On the other hand, such an executive order from the president could be used for this means. This could be done in a move known as indexing capital gains to inflation. For those that don’t know, this is where the original purchase price of a specific asset is changed when it’s sold. This would mean that no tax is paid on the appreciation tied to inflation. For the crypto space, this would mean much less benefits to traders as profits in crypto can make CPI look insignificant.