Bitcoin has produced its fair share of millionaires, and the latest Bull Run has undoubtedly increased this figure significantly. This has resulted in a variety of concerns for investors who have profited from the digital asset, the most significant of which is taxation. Many of these wealthy have begun to escape to locations with less stringent tax regulations and warmer weather.
According to a recent CNBC report, bitcoin millionaires are flocking to Puerto Rico and its gorgeous islands. Crypto entrepreneur and investor David Johnson explains the reasons for his relocation to Puerto Rico from New York are its environment, and tax savings granted to individuals. He was also influenced by his friend’s relocation to this place as well as a facility to retain their American passport.
Locals are not happy
Locals in Puerto Rico are dissatisfied with the relocation of individuals to the tropical island as they do not qualify for the tax benefits as the non-Puerto Ricans do. People like Johnson, who moved here from other countries after earning millions with cryptocurrency, do not even have to pay capital gains taxes on their earnings. Puerto Ricans, on the other hand, must pay a long-term capital gains tax of up to 15 per cent.
These tax incentives, which were intended to attract more employment and investment to the region, are increasingly being used by people to avoid capital gains tax and are a cause of contention between locals and non-locals. Furthermore, the flood of new rich people is driving up housing prices.