Italy aims to improve crypto regulations by raising capital gains taxes on traded crypto assets.
From the start of 2023, all cryptocurrency profits over 2,000 euros will be subject to a capital gains tax of 26%.
Portugal will also be increasing their taxes on crypto assets starting next year as crypto regulations become more commonplace around the world.
Italy joins Portugal in cryptocurrency taxation
Italy will introduce a capital gains tax of 26% on all cryptocurrency profits. Under the new law, cryptocurrency traders will also need to disclose their trades and crypto holdings.
Up until now, digital assets have been treated as foreign currencies in Italy and as a result, a low taxation band was applied.
From January 1, 2023, taxpayers will also have the option to declare their digital assets and pay a 14% tax on their holdings.
Italy's decision could be impacted by Portugal's announcement in October that a 28% capital gains tax will be levied on crypto gains starting in 2023.
Crypto traders used to call Portugal a crypto-friendly nation due to the country’s lack of crypto regulations.
With Italy following Portugal’s footsteps, other countries with relaxed laws on cryptocurrencies may follow.
Crypto regulations increase around the world
Following the FTX-Alameda collapse which also brought down crypto lender BlockFi, speculators anticipate more crypto regulations will be imposed on the industry in the near future.
The UK government amended their crypto and digital asset laws this year to make it easier to track down crypto fraudsters. At the same time, UK bank Santander announced that they will be banning payments to crypto services made using Santander bank accounts.
In the United States, a new cryptocurrency regulation framework was released along with a new bill that put a 2-year ban on the creation of new stablecoins.
The news came around the same time that FTX announced that they were interested in making their own stablecoin following the collapse of Terra Luna's UST algorithmic stablecoin.
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