Italy imposes a 26% tax on cryptocurrencies

The new cryptocurrency tax in Italy will impose a capital gains tax of 26% on traders.

The tax on cryptocurrency traders will go into effect next year, Coindesk reported on Friday (Dec. 30). The report notes that the tax is part of Italy’s new budget, which defines crypto-assets as “a digital representation of value or rights, which can be transferred and stored electronically, using distributed ledger technology or similar technology.”

The budget, adopted on Thursday (December 29), includes $22.3 billion in tax breaks to help businesses and households tackle Europe’s energy crisis, Reuters reported.

The tax rate applies to earnings from trading cryptocurrencies in excess of 2,000 euros ($2145) per tax period. The bill also creates an “income substitute tax” for investors at 14% of the value of assets held as of January 1 next year, rather than the cost at the time of purchase, Coindesk reports.

The new regulations also allow investors to deduct losses from cryptocurrency investments from profits and carry them forward.

The adoption comes just over a week after reports that the Italian government was backing a plan to reduce digital payment fees for retailers.

The measure, part of the new budget, would require a “solidarity levy” from banks and payment processors to reduce digital payment fees for merchants.

“We intend to eliminate the measure on points of sale,” said Italy’s economy minister, Giancarlo Giorgetti, during a recent hearing on the budget.

He added that some sort of compensatory measure could be created in its place to help merchants with card fees.

Meanwhile, PYMNTS reported on Friday on efforts in the UK and the European Union (EU) to adopt and amend their regulations governing cryptocurrencies next year.

This fall has seen a series of amendments to the UK’s Financial Services and Markets Bill (FSMB) to ensure that the law includes crypto assets within the regulatory purview of the country’s Financial Conduct Authority (FCA).

“As a result, the FSMB calls for a confrontation with the EU’s Cryptocurrency Markets Regulation (MiCA), also slated for adoption in 2023 after the delay of a vote initially scheduled for December,” PYMNTS wrote.

In a summary of the different rules and regulations, UK Treasury Economic Secretary Richard Fuller noted that “the UK’s approach to financial services is to have an agile system that relies heavily on regulators regulators to write their rules as things are brought within the regulatory perimeter.

Separating this from the EU’s “more legalistic approach,” during a debate on cryptocurrency regulation, Fuller said, “in the UK we trust regulators to work quickly and effectively to write the rulebooks that are right at that moment”.

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