Portugal has announced that it will levy capital gains tax on digital assets in the coming months. According to a statement by the country’s finance minister, the move is presently in progress, although a set date has not been chosen. This will trigger a big blow on the majority of the crypto population hoping to enter the country. The country has been a haven for crypto firms judging by the lack of tax payments on digital assets.
Portugal erases 2016 tax-free law
The new update has enjoyed the backing of several individuals in the government, including the secretary responsible for the tax affairs in the country, Antonio Mendes. Mendes has a statement to support the update at a recent interview that he held some days back. Although the full details of the tax have not been rolled out yet, the country is confident that it will tax traders on gains made from digital assets like Bitcoin.
However, this new law will nullify the previous one that refuses to recognize crypto as a legal means of exchange across the country. The 2016 law did not require tax on crypto gains. In his statement, Medina mentioned that one of the triggers of the new law was a comparison carried out between Portugal and counties that have a perfect crypto taxing system.
The finance minister promises friendly taxation
The news outlet also mentioned that the finance minister also hinted through his statement that it would not be okay for the country not to tax gains that traders earn from crypto. However, the government will not impose a heavy tax on individuals and investments. The minister said that although the country wants to impose a tax, it will ensure that it doesn’t harm traders by eating up a massive part of their revenue.
Mendes also mentioned that taxing digital assets would be very hard because they do not have a clear definition. Before now, Portugal has been regarded as a haven for crypto individuals and companies. The Golden Visa that the country awards opens up awarded parties to tax-free transactions and permanent residency. The initiative was started to drive a massive amount of foreign investors into the country. As far back as February, an individual praised the increased adoption of crypto in Portugal while predicting that the country could be like El Salvador, installing Bitcoin as a legal tender. However, there is much to that effect this new rule has come into play.