The Polish Finance Ministry has been forced to backpedal, temporarily abandoning its controversial crypto tax policy, after widespread protests. What began with media reports, quickly escalated to online petitions and then actual protests in the capital city, Warsaw.
In a statement, Deputy Finance Minister Paweł Gruz was quoted as saying:
The Ministry of Finance has accepted the irrational effect of the PCC tax on cryptocurrencies… So far, the Ministry hasn’t done anything about the PCC, except for recognizing cryptocurrencies as property rights, which automatically means obligation to pay the civil law transactions tax.
The Ministry now says it will conduct more analysis before announcing its next move. Part of the reason for the public backlash was timing, with the taxation law being announced very soon before the end of the tax year. The law covered all income and gains related to any form of crypto, but also referred to trades, which would also be taxed even if losses were made.
The other side of the coin though, is the perception that the Polish government have been taking aim at Bitcoin et al. over a long period of time. What began with a move to classify crypto in the same breath as money laundering and terrorist financing then moved on to the government using taxpayer money to promote anti-crypto propaganda on YouTube and printed publications within the country.
While the Finance Ministry are backing out of the regulation for the moment, it’s not all good news for those who were promptly compliant. Gruz said:
There will be no PCC tax on trading of cryptocurrencies before any final solutions are worked out, which will happen in no less than two years. However, we maintain the obligation to settle the personal income tax, while working on temporary solutions.
He went on to add that there would currently be no refunds offered to those who had already paid taxes on crypto trades and gains.
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