Dutch government to amend tax on unrealised crypto gains: ‘Something simply went wrong’

Dutch crypto investors released a collective sigh of relief on Wednesday, after Eelco Heinen, the country’s finance minister, said he planned to amend controversial legislation that would tax unrealised gains on digital assets and other investments.

The law, approved by the Dutch House of Representatives on February 12, would require Dutch nationals to pay a 36% tax on crypto value increases, even if they haven’t sold any.

“I don’t think the law can pass as it is,” Heinen told Dutch television news service RTL Nieuws. “Something simply went wrong here, and the current law needs to be amended.”

The policy, dubbed the Actual Return in Box 3 Act, has been widely criticised from both the crypto industry and more broadly.

The biggest issue is that under the new law, if an asset’s value rises one year but crashes the next, taxpayers could owe hefty tax bills even if they lost money on their investments.

‘The dumbest thing’

The legislative volte-face comes as governments across the world grapple with crypto regulation as the asset class gains mainstream recognition.

Most countries have implemented laws that tax cryptocurrency gains similarly to other investments, barring a few so-called crypto tax havens, such as Dubai, Abu Dhabi, and the Cayman Islands, among others.

Taxing unrealised gains on investments is rare, and unprecedented at the scale proposed by Dutch lawmakers. Critics say doing so would punish wealth-building, disrupt investors’ ability to compound their returns, and risk driving away entrepreneurs and capital.

“This is the dumbest thing any government on planet Earth is pursuing right now. And that’s saying something,” Shopify CEO Tobias Lütke said in a February 13 X post.

The law still needs to pass through the Eerste Kamer, the Dutch Senate, and won’t take effect until January 1, 2028, giving Heinen plenty of time to make amendments.

It’s not clear if the law needs to be completely reworked or only amended in parts, however.

The finance minister said he has already spoken with his state secretary about it.

“We also said together: let’s go back to the drawing board, start a discussion with the House of Representatives and the Senate, and see how we can amend the law,” he said.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at [email protected].