Denmark’s Tax Law Council has recommended introducing a bill that could potentially tax unrealized gains and losses on crypto assets held by Danish investors as early as 2026. In its 93-page report on crypto asset taxes, the council suggested that all crypto assets be taxed according to a consistent set of rules, considering three potential models: capital gains tax, warehouse taxation, and inventory taxation.
Danish Tax Minister Rasmus Stoklund, in the report, highlighted numerous cases where Danish crypto investors were unfairly taxed under the current “capital gains tax” approach and suggested that new tax rules should provide a simpler way to tax crypto assets. However, the recommendations are not final, and the proposed changes are not guaranteed to become law. Some social media users have misinterpreted the report, believing the tax changes are definite.
The report appears to lean toward recommending an “inventory taxation” model, which would treat an investor’s entire portfolio as a single inventory to be taxed by a specific date each year, regardless of whether or not the assets have been sold. Under this model, crypto assets would be taxed alongside other financial assets, such as stocks and bonds, taxing both unrealized gains and losses.
The recommendations did not specify whether the new tax rules would apply retroactively to existing crypto holdings. Additionally, the Tax Council proposed that crypto asset service providers, such as exchanges and payment firms, be required to report customer transactions in a way that would be accessible across the European Union.
Tax Minister Stoklund stated that the new bill will not be introduced to the Danish Parliament until early 2025, with the proposed rules not taking effect until January 1, 2026, at the earliest. The recommendations will need to be evaluated and approved by the Danish Parliament before they can become law.
Denmark’s push for new crypto tax rules comes amid broader global efforts to tighten tax regulations for both crypto and traditional financial assets. In the United States, Democratic presidential candidate Kamala Harris recently endorsed a policy to introduce a 25% tax on unsold assets. Similarly, the Italian government is considering raising the capital gains tax on Bitcoin holdings from 26% to 42% beginning in 2025.