Investing General Discussion
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Sheriff Cad
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Dutch Lawmakers Approve a 36% Tax on Unrealized Crypto, Stock, and Bond Gains - IMI Daily
Starting January 2028, the Netherlands is set to require that residents pay tax on paper profits they have not yet cashed in, pending Senate approval.
www.imidaily.com
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Tax on unrealized gains is a crazy policy. The same people getting raped by these taxes will preach about their "free" healthcare to Americans though.Dutch Lawmakers Approve a 36% Tax on Unrealized Crypto, Stock, and Bond Gains - IMI Daily
Starting January 2028, the Netherlands is set to require that residents pay tax on paper profits they have not yet cashed in, pending Senate approval.
Sheriff Cad
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Its a great policy if you hate money and don't want your citizens to invest.
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Khane
Got something right about marriage
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Where's my tax rebate for unrealized losses?
EDIT: Oh they actually are doing that
"Also, if an investor incurs a net loss in a given year, that loss can be carried forward and used to reduce taxable gains in any future year, with no time limit. Only losses exceeding €500 qualify for this treatment; amounts below €500 are written off. "
EDIT: Oh they actually are doing that
"Also, if an investor incurs a net loss in a given year, that loss can be carried forward and used to reduce taxable gains in any future year, with no time limit. Only losses exceeding €500 qualify for this treatment; amounts below €500 are written off. "
Sheriff Cad
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They have unlimited loss carry forwards. Doesn't really help since in down years its not like you get rebates, but you could use it to offset future gains?
But in a normal retirement/hold scenario, you will get absolutely raped on this.
Khane
Got something right about marriage
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Its completely absurd. Doesn't seem like there is any provision for liquidity issues either, so if you can't afford the tax bill on your unrealized gains you'll have to sell to cover it which then also triggers another tax event the following year?
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Sheriff Cad
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And the UHNW people they want to get with this can evade it, so it just hits the working rich as always.
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Kithani
Vyemm Raider
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You can never trust a man that wears wooden shoesDutch Lawmakers Approve a 36% Tax on Unrealized Crypto, Stock, and Bond Gains - IMI Daily
Starting January 2028, the Netherlands is set to require that residents pay tax on paper profits they have not yet cashed in, pending Senate approval.
Fucker
Log Wizard
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It is grotesquely absurd. Essentially a Tax To Zero scheme. People who can afford to ditch their citizenship will do so, and they will take all their money with them. Everyone else will simply see their investments taxed to nothing in short order and be quite fucked in the process. Fingertip math puts just about any amount of money effectively wiped out in 4 years, and that isn't considering liquidity issues which themselves are quite damaging. One market fart in the wrong direction, and your investment accounts become a giant financial liability.
Of course, EU and the UK will see this and jump on board, too.
The other obvious outcome is the destruction of value of any stocks being traded in these areas....and any other investment vehicles.
I can't think of a better way to make investing in Europe more toxic than this.
You will own nothing and be happy is no longer a meme for citizens over there.
Sheriff Cad
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This is 36% of gains, not 36% of the total? It won't tax you to zero it just means your gains will be absolute shit, forever.
Right?
Khane
Got something right about marriage
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It's just the gains but you could, in worst case scenarios, actually get taxed to past zero.
You invest in a security, $100k. It skyrockets 300% one year. You think it's going to continue to go up, so you only sell what you have to in order to cover your unrealized gains tax. It craters the following year and slowly trickles down to 1/5th of what you originally bought in for.
Your original $100k is now only worth $20k and you got taxed $108k on money you never actually had. And presumably get taxed again the following year on the proceeds from the realized gains you took in order to pay your unrealized gains tax.
What the fuck is the point of investing when something like that actually could happen to you?
You invest in a security, $100k. It skyrockets 300% one year. You think it's going to continue to go up, so you only sell what you have to in order to cover your unrealized gains tax. It craters the following year and slowly trickles down to 1/5th of what you originally bought in for.
Your original $100k is now only worth $20k and you got taxed $108k on money you never actually had. And presumably get taxed again the following year on the proceeds from the realized gains you took in order to pay your unrealized gains tax.
What the fuck is the point of investing when something like that actually could happen to you?
Sheriff Cad
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In your scenario, if I understand it right, you start with $100k. It goes up 300% in one year, you end up with a $400k value. You'd have a $300k capital gain, so you'd pay 36% of that in tax, right? You sell $108k of the security to cover the taxes (I guess you could pay this out of pocket and then the security crashes in value, is this your scenario?) so you are left with $298k. The security in the next year then crashes to 20% of its original value, or $58,400. You also now have $233k in loss carry-forwards that never expire.
If you paid the taxes out of pocket and did not sell the security, you could end up negative, although you do have a huge tax benefit waiting for you on future gains to offset it. It really depends on how those loss-carryforwards are applied.
Man. Thinking this through, investing and actually getting gains comes with huge risks because you need to sell to lock in your gains or you risk paying tax on a gain you never actually had. It's just counter-productive, it's going to guarantee nobody actually invests there because the stories of people getting turbo-fucked like in your scenario WILL happen, and people WILL spread it far and wide.
Sheriff Cad
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Probably not many, since I would wager most people will divest before this takes effect.
The big question is what the F is a normal Dutch citizen supposed to do in this instance - the tax is on worldwide holdings, so you can't just (legally) move it offshore.
This just seems like financial suicide for this particular country. No idea why they would want to do it.
There’s probably 30% of the US population that would vote for this, thinking it would have no impact on them since they don’t own stocks. Totally ignorant of all the benefits that come from living adjacent to rich people. The hatred on the left for anyone they feel has it better than them shouldn’t be underestimated.
Pretty depressing tbh
Pretty depressing tbh
Sheriff Cad
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Example: Suppose a €100,000 investment grows 10% annually for 10 years (compounding to ~€259,000 pre-tax). In a realization-based system (e.g., US long-term capital gains at 20%), you'd pay ~€31,800 in tax only at the end, netting ~€227,200. In the Dutch system, you'd pay 36% on each year's ~10% gain (~3.6% effective annual tax drag), potentially netting ~€160,000–€180,000 after taxes (depending on whether you sell to pay taxes each year). The earlier payments reduce your net by 30–40% compared to deferred taxation at a similar rate, and more if compared to lower-rate countries.
lol
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This came up before and some super leftist came up with some stuff I really never could follow. His "plan" was to not have gains set per year so he wanted to have taxes on quarterly gains or whatever he came up with in his math. Sad part at least in this country not sure about there these people vote and likely vote often. I read enough to figure out it was an investment killer.