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Portugal to Tax Annual Crypto Trading Profits at 28% Next Year

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Pavan A Follow

INDIA

Oct, 14 2022

Oct, 14 2022

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In Portugal, a nation long regarded as a cryptocurrency tax haven, the government proposes imposing a 28% capital gains tax on cryptocurrency gains under one year. As outlined in the State Budget document released on Oct. 10, cryptocurrencies have remained untaxed due to the lack of legal recognition of digital assets


A 4% tax will also be imposed by the Portuguese government on free crypto transfers and stamp duties will be applied as necessary. Crypto will be treated the same as other industries under the proposal, and a clear framework for crypto taxation will be established.


Considering Portugal's reputation as one of the European countries that promote digital assets, enthusiasts have expressed concern about the double-digit tax plans. The Finance Minister, Fernando Medina, has indicated that the tables are about to turn in Portugal. The purpose of this is to prevent tax evasion associated with this asset class. 


Over the past decade, the country has become increasingly attractive to foreigners due to its immigration and visa policies. Portugal experienced a 40% increase in immigration between 2011 and 2021, as reported by the European commission.


Members of Parliament will vote on the budget draft in the next few weeks, according to analysts, who expect little or no resistance. Socialist Party members control most of the Assembly, and the budget is expected to pass unanimously. 


It is not the first time a digital asset taxation bill is being brought before Parliament, as minority parties have already presented two proposals. The left-wing party Bloco de Esquerda and Livre's taxation proposal was rejected in May. 


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Pavan A

CBW - External Analyst

INDIA

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