The Danish Tax Law Council has recommended the adoption of a bill that will allow Danish investors to tax unrealized gains and losses on crypto assets from 2026.

The regulator has proposed three potential models for taxing crypto assets in the country: capital gains tax, warehouse tax and inventory tax. The authors of the document are more inclined to the latter model.

Under what is known as an inventory tax, a crypto investor’s entire portfolio must be treated as a single “inventory” subject to tax by a certain date each year, regardless of whether the assets have been sold by that time or not.

Under this tax model, crypto assets will be taxed along with other financial assets: stocks and bonds. This means that Danes holding crypto assets will pay tax on both unrealized gains and losses.

The council clarified that future legislation would require virtual asset service providers (VASPs), including crypto exchanges and cryptocurrency payment companies, to provide regulators with information about their clients’ transactions. This data should be available to all EU countries.

Danish Tax Minister Rasmus Stoklund called the capital gains tax on Danish crypto investors unfair and advocated adopting a “simpler” way of taxing crypto assets.

Stocklund said the new bill could only be submitted to the Danish parliament in 2025, and the Tax Council recommended that the new rules come into force as early as January 1, 2026. Recommendations presented by the Tax Council must first be reviewed and approved by the Danish Parliament before they are passed into law.

The Danish authorities proposed amending cryptocurrencies to the country’s Tax Code back in 2021 to combat tax evaders and reduce cases of fraud with crypto assets.