Italy Imposes 26% Crypto Tax

Italy’s new crypto tax is set to impose a 26% capital gains levy on traders.

The tax on crypto traders is set to go into effect next year, Coindesk reported Friday (Dec. 30). The report noted 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 the technology of distributed ledger or similar technology.”

The budget, adopted Thursday (Dec. 29), features $22.3 billion in tax breaks to assist businesses and households facing Europe’s energy crisis, Reuters reported.

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

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

Related: Crypto Firm Registers With Italian Watchdog

The adoption comes a little more than 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 contribution” from banks and payment processors to lower fees on digital payments for merchants.

“We intend to eliminate the measure on points of sales,” the Italian economy minister, Giancarlo Giorgetti, said during a recent budget hearing.

He added that in its place, some sort of compensatory measures could be created to assist shopkeepers with card fees.

Meanwhile, PYMNTS reported Friday about efforts in the U.K. and European Union (EU) to adopt and amend their regulations governing crypto assets next year.

This fall saw a string of amendments to the U.K.’s Financial Services and Markets Bill (FSMB) to make sure the law brings crypto assets under the regulatory scope of the country’s Financial Conduct Authority (FCA).

“Accordingly, the FSMB begs comparison with the EU’s Markets in Crypto Assets (MiCA) regulation, also slated for adoption in 2023 following the delay of a vote initially scheduled for December,” PYMNTS wrote.

In a summary of the different rules and regulations, the U.K.’s Economic Secretary to the Treasury Richard Fuller noted that “the U.K.’s approach on a lot to do with financial services is to have an agile system that relies robustly on the 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 United Kingdom we trust regulators to work at speed and effectively to write the rule books that are right at that point in time.”