Italy Plans to Raise Capital Gain Tax on Bitcoin

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Italy is set to significantly increase the capital gains tax on Bitcoin, jumping from 26% to 42%. This move, announced by Deputy Finance Minister Maurizio Leo, is aimed at raising revenue for the government and reducing its budget deficit, particularly in light of recent election promises.

Leo reportedly described Bitcoin’s growing popularity as a “spreading phenomenon,” according to Bloomberg.

While other countries have tried taxing cryptocurrency trading in the past, these efforts haven’t always been successful. For instance, India’s strict digital asset taxes led to a decrease in trading activity as investors sought out tax havens.

Italy’s decision comes as the European Union prepares to implement its Markets in Crypto-Assets (MiCA) framework, a set of regulations for cryptocurrencies expected to be fully operational by year’s end.