Italy Announces Capital Gains Tax on Cryptocurrencies in 2023 Budget
Rony Roy - Coin Edition
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- Italy plans to implement 26% capital gains on Crypto profits.
- Regulators aim to encourage crypto asset reporting.
- The move follows Portugal’s implementation of a similar tax slab on crypto.
Reports indicate that beginning in 2023, Italy intends to impose a capital gains tax on digital assets in an effort to increase its regulatory foothold in the cryptocurrency industry. Capital gains on digital asset trading of more than 2,000 euros would be taxed at 26%, as stipulated in the country’s budget plans for 2023.
The bill aims to increase transparency in the system by having citizens report their digital asset ownership. As such, under the proposal of Prime Minister Giorgia Meloni’s cabinet, taxpayers would be able to report the value of their assets as of January 1, 2023, for a 14% tax.
The proposed legislation includes transparency requirements and a stamp duty that applies to digital currencies. However, the bill is still subject to change in the parliament.
Italy’s move follows its European neighbor Portugal, which suggested a 28% tax on capital gains from cryptocurrency retained for less than a year in October of this year. It also suggested stamp duties on fees imposed by intermediaries in the cryptocurrency sector and a tax of 4% on the free transfer of cryptos in the event of an inheritance.
In the same vein, Germany adopted a similar position on the taxation of cryptocurrencies earlier this year. The nation issued new regulations detailing clear rules for calculating taxable income from virtual assets and cryptocurrency. A crucial aspect of the legislation states anybody who made a profit by selling cryptocurrencies like Bitcoin, Ethereum, and others more than a year ago is not required to pay taxes on that profit.
Meanwhile, Italy is striving to expand its cryptocurrency industry by licensing new businesses. Recently, cryptocurrency service providers Nexo and Gemini were accepted for registration with an Italian authority, allowing the platforms to offer their services in the nation.
Furthermore, the EU has also formalized its bloc-wide crypto regulatory framework this year, establishing a passportable licensing scheme for enterprises serving its 27 member states. The framework, dubbed Markets in Crypto Assets (MiCA), will take effect in 2024.
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