Dutch lawmakers have advanced a controversial tax proposal that would impose a 36% capital gains tax on cryptocurrency and other investment profits, even if investors haven’t sold their holdings. The measure, part of a broader overhaul of the Netherlands’ Box 3 tax system, was approved by the House of Representatives on February 13, 2026, with 93 lawmakers voting in favour, comfortably passing the 75‑vote threshold needed to advance the bill.
Under the proposed legislation, set to take effect in the 2028 tax year if the Senate also approves it, residents could owe tax on unrealized gains from cryptocurrencies, savings accounts, equities and gains from interest‑bearing instruments. That means profits on digital assets could be taxed annually based on their value increase over the year, regardless of whether the investor actually sold the asset.
How the new tax system will work
The tax is part of a shift in the Dutch tax code intended to replace the previous system, which was based on assumed returns that courts found unlawful. The “Actual Return in Box 3 Act” will instead tax the actual annual return generated by liquid assets. For example, if the value of a crypto portfolio rises during the year, that paper gain could be subject to the 36% rate, even if the holder does not cash out.
Implementation is scheduled for January 1, 2028, and comes with a tax‑free threshold of €1,800 per person, with provisions allowing for the carry‑forward of losses greater than €500 to offset future tax liabilities. Certain categories, such as real estate and qualifying startup equity, are exempt from the unrealized gains tax and are instead taxed when an asset is sold.
Investor backlash and capital flight concerns
Critics of the proposal warn that the policy could trigger capital flight as investors seek more favourable tax regimes elsewhere, particularly within the European Union where cross‑border movement is relatively straightforward. Some analysts say imposing a tax on “paper profits” could discourage long‑term holding and hinder investment in growth assets like cryptocurrencies.
Economists and prominent voices in the crypto community have expressed unease about the complexity and perceived unfairness of taxing gains that haven’t been realized, arguing that it could force holders to prematurely sell assets to cover tax bills or even relocate to countries with lighter tax burdens.
Political context and next steps
The legislative push reflects a broader political consensus to reform the Box 3 wealth tax system after Dutch courts ruled the earlier model, which taxed assumed returns, as unconstitutional. To bridge a €2.3 billion revenue gap for the treasury and ensure fairness, lawmakers advocated for the new structure, which focuses on actual returns rather than speculative assumptions.
However, resistance remains in some quarters, with opponents warning that taxing unrealized gains could undermine investment incentives and harm the Netherlands’ status as a competitive hub for innovation and finance. The bill now moves to the Senate for further review, where its fate will be determined before final enactment.
As global tax authorities increasingly grapple with how to treat digital assets and wealth, the Netherlands’ move signals a bold, and potentially contentious, approach to integrating cryptocurrencies and investments into mainstream fiscal policy.
