Starting in 2023, the Italian crypto traders will be required to pay a 26% tax on crypto gains, as per a recent budget approved by the Italian legislators on Thursday December 29.
According to Reuters, the Italian Prime Minister’s 2023 expansionary budget was required to be completed before the end of 2022 and comprises 21 billion euros in tax breaks to help households and businesses facing the energy crisis.
Meanwhile, cryptocurrency in Italy is to a large extent unregulated, the new budget (387-page) validates crypto assets by describing them 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 newly approved 26% tax rate extends to gains from crypto trading should it exceed 2,000 euros per tax period. As an incentive for declaring crypto profits, the new bill also sets a “substitute income tax” for investors at 14% of the value of the assets held as of January 1, 2023, instead of 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.”
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