Italy backtracks on crypto tax hike amid investor pushback

Forza Italia, another coalition partner, has proposed eliminating the tax hike altogether while removing an exemption for gains below €2,000 ($2,120). Paolo Barelli of Forza Italia criticized the original plan, stating that the rationale behind the 42% rate is unclear to both average citizens and major investors, and called for a more balanced approach to protect the market.

In addition to the proposed rate adjustment, the League has suggested creating a permanent working group that includes digital asset firms and consumer advocates. This group would focus on improving investor education and strengthening Italy’s crypto ecosystem. Although the government is likely to adopt the League’s amendment, the final decision is pending, and further changes could be made.

Tax Foundation Europe highlights that other European countries have varying crypto tax rates. Germany and Spain impose taxes on crypto gains ranging from 26.4% to 28%, while France taxes gains at 34%. In contrast, Switzerland remains a tax haven for crypto investors with its 0% tax on crypto gains. Meanwhile, the United Kingdom applies Capital Gains Tax to crypto, with rates of 10% for basic-rate taxpayers and 20% for higher-rate taxpayers, according to Techopedia.