DFINITY Foundation

ICP Maximalist Network

ICDevs.org

Internet Computer Association

cycledao.xyz



###### Note: This proposal comes from the community, and the content of the proposal has nothing to do with [ysyms](https://ysyms.icp.page/)

## Objective:

Dfinity to not interfere with tax payer who want to pay their taxes precisely and genuinely (IRS in USA and other tax jurisdiction) as planned in proposal 48623

## Background:

The reason the creator of this proposal have decided to avoid discussion on the Dfinity forum is that there should be any debate in regards to taxpayer who want be honest and pay their taxes diligently and precisely.
The proposal [#48623](https://dashboard.internetcomputer.org/proposal/48623) clearly state (by Jwiegley) that tax burden is a problem to solve. See section ‘Problem’. As this proposal see the tax system as a burden, some investors see it as a necessity in their community, country. Some investors also believe that everyone should pay their fair share amount of taxes as required by laws in their jurisdiction.
Post 108 on thread "request-for-feedback-compounding-maturity-proposal" on Dfinity forum from Dominicwilliams
"In the proposal, when maturity is used to produce new ICP, the quantity of ICP created some days in the future is modulated by ICP price trends. This makes it near impossible for tax authorities to draw a simple equivalence between increased maturity and ICP tokens received and thus claim that maturity represents income received that has created a tax liability. I hope that the foregoing highlights why this is important for large parts of the community, in order to help prevent them being exposed to unavoidable tax liabilities they have no control over"
Also in the same post:” For such reasons, I realized that an analysis of the current situation should be provided, to provide those in this situation with input material that might be supplied to tax advisors and/or tax lawyers. In addition, I realized that the design should be further hardened, to make it even more difficult for any tax authority around the world to claim that increases in maturity represent ordinary income that should be immediately taxed.”
Post 245 on thread "request-for-feedback-compounding-maturity-proposal" on Dfinity forum from Jwiegley "The reason the modulation exists at all is to induce uncertainty in the amount received. If it could be known in advance, there would be no reason for it."
For some investors who are staked in the NNS with no possibility to get out, this is a tax interference for tax payors who believe all rewards, in any form, are taxable and want to pay their taxes precisely according to their jurisdiction law.
This proposal creator believe Dfinity and his community should program functions to make the annual tax report easier, not harder and provide tools such as daily reports, etc.

## Proposal:

This proposal is for Dfinity to leave all actual functions in the NNS as is and to avoid any rewards modulation (5% proposed) so investors can produce appropriate tax report to their respective jurisdiction. It would let investors keep managing the exact same way as before as an option





Leave actual MERGING buttons and avoid rewards modulation as an option.