ACT promises tax-free crypto gains after a year
The New Zealand ACT party has proposed a tax exemption for cryptocurrency gains held for over a year. The policy aims to simplify tax compliance for retail investors while maintaining current tax rules for professional traders and businesses.
Why it matters
This proposal highlights the ongoing global debate regarding how governments should regulate and tax digital assets to balance revenue collection with financial innovation.
The ACT party wants to allow people to make tax-free profits from cryptocurrencies, like Bitcoin, as long as they hold onto it for more than a year.
It would also make it easier to use crypto for small purchases by creating a tax exemption for such low-value transactions.
Inland Revenue says 355,000 New Zealanders use crypto, with $36 billion worth of transactions recorded.
Under the current rules, investors have to calculate tax on profits every time they sell or swap their assets.
ACT's campaign pledge, unveiled on Thursday, would mean any gains made on certain personal crypto held for more than 12 months would not be taxed.
Professional traders or businesses trading crypto would continue to pay tax under the current rules, as would anyone who offloaded their assets within a year.
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