A provision in Italy’s 2023 budget plan looks to implement a 26% levy on capital gains earned from digital asset sales where the profit exceeds 2,000 euros.
According to budget documents made public on December 1, Italy intends to impose stricter rules on digital currencies in 2023 by extending its tax laws to cover cryptocurrency trading.
According to Bloomberg, the government has plans to impose a 26% tax on cryptocurrency trading earnings over 2,000 euros ($2,062) each transaction. As “foreign currency,” digital currencies have historically been subject to lower tax rates.
Taxpayers will have the choice to declare the value of their digital asset holdings as of January 1 and pay a 14% tax if the proposed law is passed. Italians are encouraged to report their digital assets on their tax filings by doing this.
Tripe A study indicates that 1.3 million persons, or 2.3% of the Italian population, are crypto asset owners. According to estimates, 57% of cryptocurrency users in July 2022 were men and 43% were women, with the majority of users being between the ages of 28 and 38.
It appears that Italy is imitating Portugal. A 28% tax on capital gains from cryptocurrencies held for less than a year was proposed by Portugal in October. Portugal was once regarded as a tax haven for cryptocurrencies.
The Portuguese government addressed the taxation of cryptocurrencies in its 2023 state budget, which had previously been ignored by tax officials due to the fact that digital assets were not recognized as legal cash.
A “wide and sufficient” tax framework will be developed in Portugal with the goal of addressing the taxation and classification of cryptocurrencies. The proposed tax plan includes provisions for capital gains as well as enterprises involving cryptocurrency trading and mining
