I believe this is similar to US tax system as crypto is not considered currency but property. However, daddy government has no way of tracking blockchain effectively since many people don't bother putting their real identity in it. I can see paying this tax in a "best effort" method.
You just keep earning money on whatever crypto you're working on at the moment but compile everything at the end of the month/year. Save that current price as your earned income. If your country has long term vs short capital gain, then you decide if you want to sell or hold. Consult with an accountant to make sure you can avoid running into problems.
As far as I'm concerned, big daddy doesn't care about your crypto record unless you're an active day trader. He just wants his piece of pie. As long as it looks sizable comparing to what hits your bank account, he will let you keep making him more money.
Like many people who despise the current crypto regulation, I understand the frustration. However, you must keep in mind that it's your responsibility to keep a reasonable tax record. Tax agency doesn't give a shit about you. If it thinks you're not paying enough tax, it will slap a fine so humongous, and if you don't pay up, you'll go to jail. It doesn't care that it is stupid and flawed, you have to prove to it that you pay a correct amount of tax. That, my friend, is the privilege of centralized power.
Actually, though I didn’t mention it in this post, the laws are very different here. Crypto is an officially recognized currency, so it is not just a capital gains system of taxation anymore.
With all due respect, from a moral standpoint, no, it is not my “responsibility” to comply with my own mugging (violent extortion), but even if it were, you still have not answered the scenario I have presented. That’s my point. Even for those of us who want to keep the wolves at bay according to their directives, doing so accurately is impossible.
Trust me, I'm not disagreeing with you. I'm merely stating how tax agency, at least in good old USA, would treat anybody. Realistically speaking, who would bother asking tax agency to be morally correct? So yes, you can raise all the points in your post above and it would make perfect sense. We can push for a more simple version of tax code but in the mean time, that's how you and I are going to get treated.
It is impossible to list every single transaction with the price stamp at the moment, that's why I suppose it can only be done in a "best effort". They only left 2 options: comply and you get some peace of mind, or risk it and they'll come after you with every tricks in the book. But I get your point and wish you good luck on tax filing this year.
Yeah, I don’t mean to be confrontational, either, so if I came off that way please forgive me.
You are right that they don’t really care about what is moral, ethical, etc.
I’m not so much requesting that the state changes (it never will), but just searching for some clarity as to how to keep the wolves at bay.
The consensus I have reached so far to avoid piquing their attention is as you said, a consistent, best-effort approach.
Anyway, thanks for your commentary.