4 ms·

Isn't this just a better reason to switch to decentralized anonymous exchanges like Bisq or used anonymized transaction technologies like ring signatures and ze

Isn't this just a better reason to switch to decentralized anonymous exchanges like Bisq or used anonymized transaction technologies like ring signatures and zero knowledge proofs (Monero/ZChash)? I've used Coinbase so far to learn about crypto, and I fully intend on paying all taxes owed, but Bisq seems like the next best on-ramp if it can help avoid the headache of treating crypto transactions like stocks rather than currencies. Of course I understand the sentiment that people should pay their taxes to society, but I wonder if this is not just going to result in an escalating arms race. This was prevented with dollars since most dollars earned by the populace can be traced back to a paystub, but once you've earned crypto in an anonymous transaction, it seems like a losing battle to try and tax any aspect of that. I can't help but feel the IRS would be better served by taxing at the off-ramp like a sales tax at a POS rather than trying to fold this into an existing income tax structure. A government can kind of control a brick and mortar retailer or Amazon more so than an individual person who say sold a book direct to consuers for Monero or sold their car for ZCash. Is the federal government prevented from creating a national sales tax for some reason?

muttled 5y ago
Property you pay sales tax on is still another taxable event if you sell it for more than you paid. Sales tax does not remove the requirement to report income.
jl2718 5y ago
It’s not a reason to, but it might be a motivation. Unfortunately the technology is well ahead of the law, which is the perfect storm for punishing honesty. The US is well ahead of the rest of the world in enforcement. But also unfortunately, this means that the costs and risks of participation in this new financial system is massively greater for US citizens. There is some international pressure for other countries to tax crypto trades instead of just fiat gains. Indonesia and Korea are considering it. France has clarified that they will not. Switzerland doesn’t tax capital gains at all. The differences between countries will unfortunately have consequences for which economies and citizens lead or get left behind - unless it’s all bollocks and national fiat with dollar reserve is the future.

muttled 5y ago

Property you pay sales tax on is still another taxable event if you sell it for more than you paid. Sales tax does not remove the requirement to report income.

jl2718 5y ago

It’s not a reason to, but it might be a motivation. Unfortunately the technology is well ahead of the law, which is the perfect storm for punishing honesty. The US is well ahead of the rest of the world in enforcement. But also unfortunately, this means that the costs and risks of participation in this new financial system is massively greater for US citizens. There is some international pressure for other countries to tax crypto trades instead of just fiat gains. Indonesia and Korea are considering it. France has clarified that they will not. Switzerland doesn’t tax capital gains at all. The differences between countries will unfortunately have consequences for which economies and citizens lead or get left behind - unless it’s all bollocks and national fiat with dollar reserve is the future.