Italy : capital gains on BitCoin at 42%. One of the highest taxes in the world
Italy plans to increase the capital gains tax on BitCoin from 26 percent to 42 percent.
A decision that is part of the electoral program of the current government, which promised to finance (onerous) electoral promises while reducing the budget deficit.
Italy is preparing to raise the capital gains tax on BitCoin and other cryptocurrencies to 42 percent, according to Deputy Finance Minister Maurizio Leo, who broke the news during a conference on October 16.
Maurizio Leo explained that with the popularity of cryptocurrencies, particularly BitCoin, the government plans to increase the withholding tax rate from the current 26 percent to 42 percent.
“As this phenomenon (BitCoin) spreads, we expect the withholding tax to increase from 26 percent to 42 percent”.
Maurizio Leo’s proposal is not new, as other countries have already tried to tax the cryptocurrency market.
However, these efforts have often failed to significantly increase government revenue.
This proposed tax increase could make Italy one of the highest cryptocurrency taxing countries in the world.
Meanwhile, this new tax plan seems to deviate from previous promises made by Prime Minister Giorgia Meloni, who assured citizens that there would be no tax increase.
However, her comments appear to be aimed at avoiding an across-the-board tax increase, rather than specific changes to niche sectors such as cryptocurrency.
“As we promised, there will be no new taxes for citizens.
In addition, we will make the tax cut for workers structural, and 3.5 billion from banks and insurance companies will be earmarked for healthcare and the most vulnerable to ensure better services that are closer to everyone’s needs.”
Two years ago, for example, India introduced a strict tax on digital assets.
This only led to a decline in trading volumes, as many local investors moved to offshore platforms to avoid taxes.
Tether CEOPaolo Ardoino expressed his frustration by sharing a meme alluding to a possible exodus of cryptocurrency users from Italy to more tax-friendly jurisdictions.
He later commented that the Italian logic seems to be that the more successful an industry is, the more it should be taxed.
“The more successful something is the more it should be taxed !
How dare they, the subjects, use #bitcoin as a protection/option against Italian fiscal policy !
Well, I would say impeccable logic… ah, please breathe less”.
Italy’s announcement comes as the European Union prepares to implement new regulations for cryptocurrencies.
Known as MiCA, this regulatory framework is expected to be fully in place by the end of this year.
