The authorities in Portugal intend to levy a tax on profits from short-term crypto investments with the state budget for next year. The document, which still needs approval from Portuguese lawmakers, signals a change in the EU nation’s positive attitude towards crypto assets.
Portuguese Government Proposes New Tax for Crypto-Related Earnings
In recent years, Portugal has established itself as one of the most crypto-friendly countries in Europe, with the decision to refrain from taxing profits derived from trading cryptocurrencies, unless they are part of a commercial activity and play a role. key code. It attracted many cryptocurrency enthusiasts. However, that is likely to change in the near future if parliament approves the government’s proposed budget for 2023.
The draft includes a provision allowing authorities to tax gains from cryptocurrency holdings held for less than a year at a rate of 28%, Bloomberg reported citing the document. Similar proposals were rejected by Portuguese lawmakers earlier this year. According to the latter, the exemption should remain in place only for crypto assets held for more than a year.
The document presented to the legislature on Monday further reveals that income from the issuance of new coins and cryptocurrency mining operations will also be considered taxable. The plan is also to introduce a 10% tax on free cryptocurrency transfers and a 4% levy on commissions charged by brokers on cryptocurrency trades.
The executive branch in Lisbon says the proposed tax rules correspond to legislation already adopted in other EU jurisdictions. He suggests Germany as an example, the economic locomotive of the Union, where crypto investors are exempt from tax obligations if they hold digital assets for more than a year. During a briefing, the Secretary of State for Fiscal Affairs, António Mendonça Mendes, commented:
It is a regime that fits into our tax system and also into what is being done in the rest of Europe.
The Lisbon move comes as institutions in Brussels are working to introduce a comprehensive regulatory package known as the Markets in Crypto Assets (MiCA) legislation that should be implemented across the EU. Last week, members of the European Parliament also urged the adoption of uniform crypto tax rules across member states.
Do you think Portugal will lose its appeal as a crypto destination if the proposed change in its tax regime is adopted? Share your thoughts on the matter in the comments section below.
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