Italy’s Economy Minister Considers Revising 42% Crypto Tax Plan After Party Pushback

Crypto Reporter

Shalini Nagarajan

Crypto Reporter

Shalini Nagarajan

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Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

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Last updated: 

November 8, 2024

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Italy’s economy minister reportedly said on Thursday that he is willing to reconsider the proposed tax hike on crypto capital gains. This move came in response to pressure from lawmakers within his own party who urged him to drop the plan.

“I am willing to consider different forms of taxation for people who keep investments in their portfolio,” Minister Giancarlo Giorgetti said, according to Reuters.

The Treasury plans to raise the tax on capital gains from cryptocurrencies, such as bitcoin, from 26% to 42%, according to the 2025 budget. Parliament aims to approve this budget by the end of December.

Italy’s Council of Ministers Greenlit Crypto Tax Hike

Italy’s Council of Ministers approved this new tax aimed at using investment profits to strengthen the economy, according to local reports.

The UK is also exploring similar changes, with Chancellor Rachel Reeves reportedly considering an increase in capital gains taxes on digital assets.

The Italian government aims to boost revenue through this tax hike to support initiatives for families, youth, and businesses, while addressing fiscal deficits. This move also aligns with the upcoming adoption of the Markets in Crypto-Assets (MiCA) regulation, which seeks to create a uniform regulatory framework for digital assets across the EU.

Italian Lawmaker Criticizes Proposed Tax Hike

Reuters reported that raising the tax rate sparked backlash within Giorgetti’s League party. Lawmaker Giulio Centemero criticized the decision as “counterproductive” and called for thorough discussions with market participants on the issue.

Italy has historically trailed behind countries like the UK and Germany in cryptocurrency activity. However, it has recently seen a sharp increase in crypto users, with estimates showing over 3.6m Italians actively engaging with digital currencies.

This rise is driven not just by speculative investments but by practical crypto transactions, indicating broader acceptance of digital currencies as a legitimate financial tool.