Puerto Rico To Become Cryptocurrency Capital Due To Favorable Tax Laws
November 05 2021 - 12:00PM
NEWSBTC
One of the controversial topics in recent times is the payment of
tax on cryptocurrency gains. In the USA, the IRS termed virtual
currencies as property which means that holders will pay taxes like
holders of fundamental properties or stocks. The agency even sent a
subpoena to many centralized cryptocurrency exchanges to give up
the information of non-compliant taxpayers. Even though many people
in the cryptocurrency community frown against such taxes, the
government is bent on ensuring compliance. Presently,
non-compliance to the crypto tax payment requirement attracts legal
action. So, it is not surprising that cryptocurrency investors seek
a tax-free state to operate without limits. Puerto Rico Becomes Tax
Haven For Investors As the United States clamped down on
non-compliant citizens, the top affluent crypto investors moved to
Puerto Rico to avoid taxes. The territory, though in the USA, is
not charging federal income tax on crypto gains. The cryptocurrency
market is down in red zone | Source: Crypto Total Market Cap on
TradingView.com According to its local law Act 22, residents of
Puerto Rico are exempted from paying taxes on capital gains,
interests and dividends. So, people are free to keep all their
profits to themselves at least for six months. Related Reading
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“Ransomware Economy”? Many people were not aware of this provision
until Frances Haugen let the cat out of the bag. The whistleblower
moved to the territory a few months back and disclosed this great
news to the community. The Act has been in play for a long time,
but many people were unaware of it. Following Haugen’s move,
another media mogul, Logan Paul, moved to Puerto Rico and occupied
a mansion on the island. When our sources asked him for a reason,
he pointed out that the tax exemption is part of it. Cryptocurrency
Businesses Move To Puerto Rico Apart from these individual players,
some businesses have left their location to move to the island. For
instance, Pantera Capital –a hedge fund – is now operating on
the island. Also, SuperRare, an NFT marketplace previously
operating in Silicon Valley, has moved to the island as well. We
also gathered that another hedge fund mogul John Paulson is now
living in Puerto Rico. Due to this, the Blockchain Trade
Association in the Island plans for its first Blockchain week,
which will come in December his year. This program aims to drive
more people and businesses to move to the island. With all these
moves, it’s not surprising that Puerto Rico’s economic growth is
taking a new level. However, there is ongoing competition between
Puerto Rico and El Salvador as the latter has allowed crypto
investors to trade without paying income tax and capital gains tax
on Bitcoin. Related Reading | Over $5 Billion In BTC Paid In
Top 10 Ransomware Variants, Says U.S. Treasury Apart from these two
places, crypto investors can enjoy the same freedom in places like
the Cayman Islands, Malta, Switzerland, Nevis, and Portugal, where
miners and traders don’t pay income tax. Featured Image From Pexels
and Chart From TradingView.com
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