Crypto traders in Italy will face a 26% capital gains tax beginning in 2023, according to a new budget approved by parliament on December 29th.
Italy’s decision to impose a capital-gains tax on cryptocurrency comes ahead of the European Union’s Markets in Crypto Assets (MiCA) regulation, which promises licencing frameworks and stringent operating requirements for crypto-service providers in the 27-member bloc.
Gains from cryptocurrency trading are taxed at 26% if they exceed 2,000 euros per tax period. As an incentive for declaring cryptocurrency profits, the new bill imposes a “substitute income tax” of 14% on the value of assets held as of Jan. 1, 2023, rather than the cost at the time of purchase.
According to the new rules, losses from crypto investments can be deducted from profits and be carried forward.
Investors, however, may require some additional guidance on what qualifies as a taxable event as the document also says, “the exchange between crypto assets having same characteristics and functions,” doesn’t constitute a “fiscal case.”
(Reporting by Shikha Singh, Editing by Laxmikant Khanvilkar)
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