Italy, well-known for its architecture, culture, art, opera, literature, film, and fashion, is about to experience a one of a kind crypto exodus. Reports indicate that the Italian government will raise the capital gains tax on Bitcoin (BTC) from 26% to 42%.
Italy’s new BTC tax
On Wednesday, Italy revealed its draft budgetary plan (DBP), including new revenue-raising plans. The decision to increase Bitcoin taxes aligns with the country’s strategy to boost its revenue by 0.2% of gross domestic product (GDP).
The country plans to add 4 billion euros ($4.35 billion) to its economy in 2025. Hence, it intends to raise revenue through the implementation of revised tax regulations targeting banks, insurance offerings, and gaming licenses.
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Italy is now among the highest-taxed nations in the world. Market analysts predict that a 42% capital gains tax on BTC will cause investors to leave the country for more favorable tax regimes.
Italy’s inflation fell below 1% in September 2024. This has put more pressure on the European Central Bank to cut interest rates. With inflation cooling in other European nations and America, Italy expects BTC to hit new levels and cash out on investments.
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Economy Minister Giancarlo Giorgetti is set to hold a press conference on Wednesday. As of now, BTC remains unaffected by current news. Per on-chain data from CoinGecko, Bitcoin is currently worth $67,672, a 3.1% spike in the last 24 hours.
