In a scenario of inflation and high taxes in the United States, the price of Bitcoin continues to rise. Senators and other officials are planning to apply charges on assets value could change radically.
US tax authorities have adapted the law on taxes on Bitcoin (BTC) and other cryptocurrencies. Although that has allowed regulators to save time and effort, they want to increase taxes and establish a greater fiscal scope. In other words, the state is trying to take advantage of the money of Americans to sustain social spending.
Johnny Luna, a lawyer from Gordon Law Group, believes that those taxes could have disastrous consequences. He stated they could affect the cryptocurrency ecosystem as well as any property generating capital gains.
According to Luna, there are constant ups and downs in the price of Bitcoin and other cryptocurrencies. For that reason, he considers that many people would have to pay taxes on something whose value could change radically overnight.
The representatives of the Senate promoting those measures might not receive sufficient votes due to popular discontent, said the lawyer. Actions like those he criticizes would affect the entire stock exchange and real estate markets, among others. He added that this would be catastrophic for those who invest and the US economy.
Paying Unrealized Capital Gain Taxes in the United States
A realized capital gain is the final payment to a creditor or his withdrawal of earnings on an investment. On the contrary, an unrealized profit is the revaluation of something purchased, whose incomes a creditor has not yet received.
Senators and other officials are pushing through a proposal to apply an unrealized capital gain tax on the wealthiest taxpayers in the United States.
The Secretary of the US Treasury, Janet Yellen, and the President of the House of Representatives, Nancy Pelosi, recently announced a measure. They told television channel CNN that the Democratic party would propose new taxes within the framework of the discussion of the infrastructure law.
Yellen also stated that those taxes were on unrealized capital gains, even though they will focus on the capital income of the wealthiest.
According to the project titled Billionaires by the Numbers, the 664 billionaires in the United States are a population minority. However, the concept of unrealized capital gain tax does not set a precedent for its effects on the entire economy.
As the US Economy Falters, Bitcoin Remains Firm
The shortage of workers, the port crisis, and the energy consumption cuts are disrupting the US economy. Besides, the increase in the prices of fuel and commodities is making the situation less sustainable.
Year-on-year inflation in the United States between September 2020 and September 2021 reached 5.4%, not seen since the real estate crisis of 2008. There is a potential threat of taxes, but the value of Bitcoin increased until it reached an all-time high.
If the wealthiest sector of the population has to pay more taxes, an increasingly unfavorable economic scenario could unfold. That would continue to strengthen the role of BTC as a free currency without intermediaries to safeguard value.
By Alexander Salazar
