Taiwan’s Ministry of Finance is reviewing crypto tax rules after Trump’s win amid rising Bitcoin and Dogecoin prices, pushing regulatory updates.
Taiwan’s Ministry of Finance is reviewing its regulations on taxing cryptocurrency gains. The move follows a surge in crypto prices after Donald Trump’s presidential election victory in early November. Finance Minister Chuang Tsui-yun pledged to reassess the rules during a legislative hearing. Members of parliament questioned whether the government has been efficiently implementing the law by taxing individuals who are making gains from trading cryptocurrencies.
During the hearing, Kuomintang’s Lai Shyh-bao insisted that given cryptocurrency is a digital asset, it should fall under the Income Tax Act. According to Lai, digital assets should not be exempt from income tax. Wu Lien-ying, director-general of the National Taxation Bureau of Taipei, argued that the current policy is sound. The bureau collects business and corporate taxes from 26 cryptocurrency exchanges registered with the Financial Supervisory Commission. These exchanges are recognized as legal entities. However, she could not explain how the individual traders operating in these exchanges are charged with tax.
Another official of the Taiwanese government who supported Lai’s statements was Sung Hsiu-ling, the director-general of the Taxation Administration. However, Lai asked how taxes can be recovered if there is no check on auditing. In response, both Chuang and Sung promised to examine the taxation rules every three months. This will enhance the collection of taxes on profits made out of cryptocurrencies.
Taiwan Faces Crypto Tax Challenges Amid Bitcoin and Dogecoin Surge
Crypto taxation became more relevant after the increase in the value of digital assets such as BTC and DOGE after Trump’s victory. By November 19, Bitcoin was already 32.7% up at $90,723, and Dogecoin, promoted by Trump lover Elon Musk, was 103.3% up.
At present, the principle that governs the Taiwan tax regime is territoriality. This means that income tax is only imposed on income derived within Taiwan. However, when the transaction is done internationally, monitoring and pursuing cryptocurrency transactions is even more challenging. An analyst opined that taxes are easily evaded as transactions can be masked as international business transacted in foreign currency.
Foreign exchange gains are only taxable if, in the year 2024 or after, such gains from trading on foreign exchanges exceed NT$7.5 million (US$230,372). The expert also noted that these many big crypto profits could easily avoid scrutiny if they were below this mark. With growing crypto activity and Trump’s pro-crypto stance, Taiwan’s government is under pressure to update its tax policies. As the digital economy evolves, adapting these regulations has become increasingly urgent.
