Italy’s Parliament Approved Proposing a 26% tax on crypto gains above 2,000 euros ($2,110).
In addition to heavily taxing crypto profits, the new law also introduces incentives for taxpayers to report their crypto. Under the law, crypto owners are entitled to amnesty for undisclosed gains made in previous years by paying an “options tax” of 3.5% and a 0.5% penalty for each additional year.
The law was passed by the Italian parliament on December 29 as part of the 2023 budget, reports local news outlet Rai News. Reported,
As expected, the law also allows taxpayers to deduct their crypto losses in excess of 2,000 euros.
Another incentive in the proposal is to allow taxpayers to declare their crypto holdings from January 1 and pay a tax rate of 14%.
The budget, which is a part of the new crypto profits tax, is the first brought out by Italy’s new Prime Minister Giorgia Meloni, who promised significant tax cuts for Italians during his campaign.
Italy’s move comes after last year’s E.U. Approved the Markets in Crypto Assets (MiCA) Bill, The bill establishes a harmonized regulatory framework on crypto in the EU, and is expected to come into force in 2024.
Portugal is no longer a crypto haven
recently, Portugal also proposes to tax crypto profitsThe country has been known as a crypto tax haven for many years now.
According to the proposal, gains on crypto held for less than a year from 2023 would be taxed at a rate of 28%, which is higher than Italy’s rate. However, given that the tax only applies to gains on crypto held for less than a year, Portugal can still be seen as one of the more crypto-friendly countries in Europe.
Portugal has so far not taxed crypto profits at all, which has helped make it a popular destination for newly wealthy crypto owners looking for a new home.
among other things, Tax attorney reporting in Spain Spaniards with crypto holdings were “fleeing” to Portugal to avoid levies on their token-related profits. He warned that Spain was on the verge of becoming a “crypto desert” as the country intensifies its regulation of the sector.
Portuguese lawmakers have argued that the move to tax crypto is necessary to bring the rules in line with crypto legislation in other European countries, including Germany, where investors pay no tax if they hold crypto for more than a year.
So far, no other European country has announced new tax regulations specifically related to crypto for 2023.
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