AMSTERDAM: Dutch investors will likely ditch their cryptocurrency if the asset class is carved out of a shift to a new investor-friendly wealth tax, industry groups warn.
Under current government proposals, investors in crypto, along with gold and foreign currencies, will continue to pay an annual levy on unrealised gains until at least 2030.
Crypto-linked exchange-traded products, by contrast, would fall under the new capital gains regime.
“Many of our major members are indeed very afraid of that,” said Jan Scheele, board member of the Blockchain Netherlands Foundation, representing all start-ups and companies across the Dutch blockchain ecosystem.
Such a shift could happen fast too, as “the beauty of crypto is that you can very quickly withdraw it from an exchange and deposit it somewhere else”.
The sell-off “is very likely to happen, since the majority of crypto-holders do not want to be taxed on unrealised capital gains from a volatile asset”, said Mauro Halve, chairman of the Dutch trade association of regulated crypto service providers NVC.
NVC’s members represent over 95% of the assets under management in the nation’s crypto sector, including Bitvavo, Moonpay and Coinmerce.
The Dutch plan to move from a tax on paper profits to a capital gains tax, paid upon sale for investments like shares, bonds and options by 2028.
The switch will bring the Netherlands in line with most other European countries and has been welcomed by investors for being fairer and simpler than taxing paper or theoretical profits.
Still, in a rush to push through the wealth tax reform, the Dutch government could potentially open the door to fresh legal challenges, after years of court battles over the taxation of unrealised gains.
Treating economically similar investments differently based on their legal structure could raise questions under the same property rights and anti-discrimination principles that led the Supreme Court to rule against the previous tax on assumed returns in 2021, according to both industry groups.
“The temporary distinction is justified because it is an interim step that will more quickly bring a larger portion of the assets under capital gains tax, a spokesperson for the Finance Ministry said.
A previous change to wealth taxes included a legal framework that allowed the quick introduction of capital gains tax for 90% of financial assets held by Dutch taxpayers, such as shares and bonds, but not for a range of other assets including crypto and gold.
Without this framework, there is not enough time to switch to capital gains tax in 2028, according to Tax Secretary, Eelco Eerenberg.
“The group of people who will not yet be subject to capital gains tax is getting smaller and smaller, but it’s not zero, and that is the price we pay for this fast-track approach,” Eerenberg said.
Such a distinction is “unfair and legally questionable”, according to Paul Buitink, managing director of Holland Gold, one of the biggest precious metal retailers in the country.
Halve added that “the line in the sand” that Eerenberg draws is unfair, as “the same asset should have the same tax”.
Eerenberg’s plan is not yet final and could still change. The Council of State, the government’s highest legal advisory body, is expected to issue its opinion on the legislation at the end of October, potentially prompting the cabinet to revise its proposal.
Both the NVC and Holland Gold submitted objections to the council and hoped the process could still lead to changes.
The House of Representatives is scheduled to vote on the tax plans on Nov 12, leaving the Senate to approve the legislation before the end of the year.
The switch to capital gains tax for 90% of financial assets will initially generate €3bil less a year than under a previous proposal of an annual paper profits tax on shares and bonds.
A reduction in crypto holdings by Dutch taxpayers could widen this gap in the medium term. Dutch companies, institutions, and households held €1.2bil in crypto securities by October 2025, according to the Dutch central bank. — Bloomberg
