The Italian Parliament has approved the implementation of a 26% taxation on any crypto-oriented profits above €2,000 on Dec. 30.
This new legislation is a part of the 2023 Italian budget. The budget describes cryptocurrencies as a virtual representation of value, which can be held and transferred electronically through the distributed ledger.
However, it insists that cryptocurrencies do not qualify as a fiscal case. Notably, the document makes provisions for losses in crypto investments. Every loss from crypto-oriented investments would always be deducted from profits.
The budget also seeks €21 billion ($22.3 billion) in tax breaks to support various businesses and households in the country enduring energy issues.
Further, the Italian government under Prime Minister Giorgia Meloni aims to encourage owners of crypto assets to disclose their assets. To encourage this, holders who comply will be able to pay a 14% tax on their holdings as of January 2023 instead of the purchase price.
Italian government seeks to clarify crypto industry regulations
According to Prime Minister Giorgia Meloni, a good set of regulations capable of protecting investors is the only way the country can become a hub for cryptocurrencies.
The government has affirmed its preparedness to collaborate with crypto trading firms to achieve this ambition. This encouraged firms like Binance, Gemini, and Nexo to obtain registration approvals in the country.
Beyond Italy, other European nations have also taken steps to increase their taxation on crypto gains. A few months ago, Portugal introduced a 28% tax on all profits from cryptocurrencies. Further, the Portuguese government intents to kickstart a 10% taxation on free cryptocurrencies, including airdrops, and another 4% on crypto broker commissions.
