MEPs Approve Lower Tax On Cryptocurrencies

In a landmark decision, Members of the European Parliament (MEPs) have approved an amendment aimed at reducing taxation on cryptocurrencies. The amendment, proposed by the SaS, Democrats, and OĽaNO parties, received overwhelming support from MEPs, signalling a significant shift in the treatment of digital assets.

Slovakia voted 112 to 2 to approve new legislation aimed at reducing taxes related to crypto asset sales. The tax rate on profits from selling cryptocurrencies after one year of holding has been reduced to 7% and payments of up to 2,400 euros received in cryptocurrencies are…

— Wu Blockchain (@WuBlockchain) June 30, 2023

New Crypto Tax Amendment

Under the new amendment, individuals selling cryptocurrencies after holding them for a year will be subject to a reduced tax rate of seven percent. This rate is considerably lower than the standard income tax rate, providing a favourable environment for cryptocurrency investors. The amendment also highlights the need to exempt revenues from cryptocurrencies and health insurance contributions from taxation.

The financial impact of the amendment, as assessed by the Ministry of Finance, is estimated to be around €30 million per year. However, it is important to note that the proposal also includes changes in investment savings, which seek to stimulate economic growth and investment opportunities. One notable change introduced by the amendment is the exemption of taxes on payments made with cryptocurrencies up to €2400. This move aims to promote the mainstream adoption of digital currencies for everyday transactions and reduce barriers to their usage.

Furthermore, the maximum amount that can be invested in long-term investment savings within a calendar year will be doubled. This increase, from €3000,6000 to an as-yet-undisclosed amount, is expected to encourage individuals to allocate more of their funds towards long-term investments, contributing to capital market growth. Additionally, the amendment expands the circle of investors who can participate in alternative investment funds and increases the proportion of assets such funds can have from qualified investors. This move aims to foster a more inclusive investment landscape and broaden opportunities for a diverse range of investors.

Lastly, MEPs approved an increase in the threshold for income from charity advertising for non-profit organizations that is exempt from tax. The threshold, raised from €20,30 to an undisclosed amount, demonstrates the parliament’s commitment to supporting charitable initiatives and encouraging corporate social responsibility.