Italy is gearing up to raise its capital gains tax on Bitcoin and other cryptocurrencies from 26% to an eye-popping 42%. This announcement came from Vice Economy Minister Maurizio Leo during a press conference about the country’s 2025 budget, where he outlined new measures aimed at generating funds to support families, youth, and businesses.
This tax overhaul represents a major departure from the existing framework that has been in place since 2023. The new policy redefines how cryptocurrencies are taxed, moving away from their previous classification as foreign currency, which allowed for lower tax rates. Under the old rules, any capital gains over €2,000 (around $2,180) were taxed at the 26% rate.
Italy’s move aligns with a broader trend in Europe, where countries are tightening regulations on digital assets. For instance, the UK is also considering a significant increase in capital gains taxes on cryptocurrencies, potentially raising it from 20% to 39%.
In addition to the tax hike, Leo emphasized the government’s commitment to tackling tax evasion, particularly by enforcing stricter regulations on cash transactions. This initiative aims to foster a more transparent financial landscape and enhance government revenue.
Despite these proposed tax increases, Italian Prime Minister Giorgia Meloni assured the public that there would be no new taxes impacting everyday citizens. She reiterated the government’s dedication to implementing structural tax cuts for workers and mentioned plans to allocate €3.5 billion from banks and insurance companies to healthcare and support for vulnerable communities.
As Italy prepares to roll out these tax changes, the effects on cryptocurrency investors and the digital asset market will be closely watched, especially as regulatory scrutiny continues to rise across Europe.
