Crypto doesn't deserve a tax exemption

I AM (MOSTLY) bullish on crypto and (usually) sceptical of higher taxes, especially on capital gains. So why do I think it would be wrong to make crypto assets exempt from capital gains taxes, as President-elect Donald Trump's administration is reportedly considering?

- TYLER COWEN

The most obvious argument against the proposal is simply that uniform taxation is better than selective tax exemptions. If a lower capital gains tax rate is preferable, then the goal should be to make a smaller cut that applies to all assets. Exempting a single kind of asset is likely to lead to abuses. You might think that boosting crypto is important now, but which sector or asset will be selected next for special treatment? It may be one you don't think deserves it.

Many of the leading supporters of Trump's campaign were crypto-connected companies. You don't have to think this tax proposal is some kind of payback to realise that this creates problems of perception. Next time around, companies will offer campaigns financial support in the expectation of more favourable tax and regulatory treatment.