Italy’s Finance Minister Defends Proposed 42% Capital Gains Tax on Cryptocurrencies Amid Criticism

Italian Minister of Economy and Finance Giancarlo Giorgetti has defended the government's plan to increase the capital gains tax on cryptocurrencies like Bitcoin from 26% to 42%, pushing back against critics at a World Savings Day event on October 31.

He emphasized the “very high level of risk” associated with digital assets, justifying the proposed tax hike, which still requires approval from Italian lawmakers before implementation.

Giulio Centemero, a member of Italy’s Chamber of Deputies, has labeled the tax increase as “counterproductive,” advocating for more discussions among lawmakers. The Italian government anticipates generating approximately $18 million annually from the tax hike.

This follows a previous increase in 2023, where the capital gains tax for crypto trading exceeding 2,000 euros was raised to 26% as part of a budget plan.

Additionally, as a member of the European Union, Italy will adhere to the Markets in Crypto-Assets (MiCA) framework set to take effect in December.

While this regulatory framework primarily targets stablecoin issuers and aims to enhance user protection and mitigate market manipulation, it is unlikely to impact the government’s ability to levy taxes on cryptocurrencies.