Italy’s government is likely to approve a proposal to reduce the planned tax hike on cryptocurrency trading. The League, a junior partner in Prime Minister Giorgia Meloni’s coalition, has suggested a crypto tax increase limit to 28% instead of the original 42% set in last month’s budget.
This follows pushback from crypto industry leaders who argued that the proposed tax would make Italy less competitive compared to other European Union countries. Currently, the crypto tax rate stands at 26%.
The EU is set to adopt its first wide-reaching crypto regulations later this year, adding urgency to the discussion. According to a Bloomberg report, another amendment, proposed by Forza Italia, seeks to scrap the tax increase altogether, removing a tax exemption for gains under €2,000 ($2,120).
The League’s plan includes creating a working group with digital asset firms and consumer associations to better educate investors on crypto. This move comes as Italy tries to balance its finances amid EU fiscal rules, with a focus on managing public debt and stimulating growth.
As other countries have seen mixed results from taxing crypto, Italy’s decision will significantly affect its crypto industry. With global markets showing optimism, especially after the U.S. election, Italy’s new tax policy could shape its position in the crypto world moving forward.
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