After Portugal announced a hefty 28% tax on crypto gains in October, Itlay is also set to become the latest European country to cash in on crypto with a plan to tax digital trading. According to the proposal bundled in with the country’s 2023 budget, around 26% tax would be imposed on capital gains higher than $2,062 made from trading cryptocurrencies.
Previously, by Italy’s tax regime, crypto has been treated in the same way as a foreign currency would be. The latest announcement of imposing a tax on crypto gains came after several global crypto businesses prioritized expansion in Europe this year. For example, Bitpanda, a cryptocurrency exchange, recently got the Crypto Custody and Proprietary Trading license for crypto assets from the Federal Financial Supervisory Authority of Germany. However, Bitpanda is already registered in Itlay.
While Binance, the largest cryptocurrency exchange by trading volume, has also registered as a digital asset provider in several European countries, such as France, Italy, and Spain. And Gemini, a crypto exchange, recently expanded itself to five more European countries, which are Croatia, Cyprus, Hungary, Romania, and Slovenia. On the 30th of November, Gemini announced that it had also secured regulatory approval in Greece and Italy. This means that the crypto industry is also expanding in Itlay, due to which this new announcement of imposing tax came.
However, Portugal, another European country, has already announced a similar tax of around 28% on profits made from selling digital assets that are held for less than a year. According to a tax announcement from Portugal, the crypto assets, which are held longer-term, can be tax-free.
According to Itlay’s tax announcement on crypto, a part of the country’s government’s plans would allow investors to declare their holdings as of the 1st of January 2021, and get a lower rate of around 14%.