Netherlands Approves 36% Tax on Unrealized Crypto Gains starting 2028

The Dutch House of Representatives has officially greenlit a transformative and controversial tax reform. Known as the "Actual Return in Box 3 Act" (Wet werkelijk rendement box 3), the new law will impose a flat 36% tax rate on actual returns, including unrealized capital gains on cryptocurrencies like $Bitcoin and $Ethereum.

A Departure from "Fictitious" Returns

For years, the Netherlands used a "fictitious return" system that assumed a certain percentage of growth on assets, regardless of actual performance. Following several Dutch Supreme Court rulings that deemed this system unconstitutional and discriminatory, lawmakers have pivoted to taxing real growth.

Starting January 1, 2028, investors will be taxed annually on the increase in value of their portfolio, even if they haven't sold their assets. If your Bitcoin holdings increase by €10,000 in a calendar year, you will owe tax on that "paper profit" at the 36% rate, minus a small tax-free threshold of €1,800.

The Liquidity Risk for Crypto Investors

The primary criticism from the crypto community and financial experts involves liquidity. Since the tax is levied on unrealized gains, investors might be forced to liquidate a portion of their holdings just to cover the tax bill.

• Stocks and Bonds: Subject to the 36% annual tax on value increases.
• Cryptocurrencies: Treated similarly to liquid securities with annual valuation.
• Real Estate: Exempt from the unrealized gains rule; these will follow a capital gains approach, taxed only upon sale.

"The system requires investors to pay tax on gains they haven't received in cash. This could force many to exit positions prematurely," noted critics during the parliamentary debate.

Implementation and Loss Protection

While the rate is high, the bill does include a loss carry-forward provision. If the crypto market crashes and an investor records a net loss for the year, that loss can be used to offset taxable gains in future years with no time limit. This provides a minor safety net against the extreme volatility of the digital asset market.

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Netherlands Crypto Tax: What Happens Until 2028?

Between now and the 2028 implementation, a transitional system remains in place. For 2026, the provisional fictitious return on "other assets" (including crypto) is set at approximately 6%, taxed at the current 36% rate. However, following the Supreme Court's intervention, taxpayers can already appeal if their actual return is lower than this government estimate.

As the global regulatory landscape shifts, the Netherlands' move represents one of the most aggressive stances on wealth and digital asset taxation in Europe, potentially influencing how other EU nations approach crypto news and regulation.