- The levy applies to all crypto operations, including staking.
- Industry experts are raising concerns the law could make the nation unattractive for crypto investors.
The Italian government has introduced a 26% tax rate for digital assets applicable to individual and institutional investors.
The policy shifts, which took place this year, followed the passing of the country’s Budget Law last December. It applies to any gains above 2,000 euros on all crypto transactions, including staking, a term referring to the locking of assets by investors to help validate transactions in a blockchain for a return. The report first appeared on the local news outlet, L’Economia.
Up until December 31, cryptos in Italy were subject to a tax policy under foreign currencies for any portfolio not more than 51,646.68 euros. That legislation has since changed, and since January, Meloni’s administration has treated digital assets like other financial assets besides government-issued bonds.
See Related: Italy to Introduce 26% Capital Gains Levy On Cryptocurrencies In 2023
The New Taxation Policy Rubs The Crypto Community The Wrong Way
The crypto community has negatively received the new tax regime from the Italian authorities. Many fear it could render the country uncompetitive for digital asset investors who may shift focus overseas. There are also concerns that the tax policy could influence other jurisdictions to take similar steps.
Gianluigi Guida, the general manager of Binance Italy, commented: “In the absence of a fine-tuning, this legislation will be difficult to apply in practice and will open the doors to various disputes, with the risk of obtaining the opposite effect to that hoped for.”
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As digital assets evolve, several jurisdictions are considering taxing the fast-growing sector, while others are taking a favourable stance to reap the economic benefits. Germany, for instance, currently applies no capital gain tax on digital assets.