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NEW: Dutch Parliament Member Michel Hoogeveen explains how the 36% unrealized capital gains tax, just passed by the House of Representatives, will work. Here is a more detailed example: Step 1. Starting position You own 500 shares. Value on Jan 1, 2028: €50,000 Value on Jan 1, 2029: €100,000 So the paper gain is: €100,000 − €50,000 = €50,000 unrealized profit You did not sell. But for tax purposes, that €50,000 is treated as income. Step 2. Apply exemption You are married, so you get a €3,600 exemption. €50,000 − €3,600 = €46,400 taxable amount Tax rate: 36% €46,400 × 36% = €16,704 tax bill That bill is due in May, even though you never sold anything. Step 3. Market falls before you pay Now suppose by May the shares drop in value. New total value: €60,000 So your portfolio is no longer worth €100,000. It’s worth €60,000. But the tax bill is still €16,704, because it was calculated based on the January 1 valuation. Step 4. You must sell shares to pay tax To raise €16,704, you sell part of your shares. After paying the tax, you’re left with: €60,000 − €16,704 = €43,296 Originally you had 500 shares. Now you have 360 shares left. You were forced to sell 140 shares. 140 ÷ 500 = 28% of your shares gone. Step 5. What happened economically? Before the correction: Paper gain was €50,000. After the correction: Portfolio is worth €60,000. Original cost basis was €50,000. Real gain is only €10,000. But you paid €16,704 in tax. So instead of being up €10,000, you are now: €43,296 − €50,000 = €6,704 below your original starting value. You turned a €10,000 real gain into a €6,704 net loss. And you lost 28% of your shares permanently.

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