Portugal's finance minister says the country wants to start taxing cryptocurrencies.
6/8/2022, 05:31 PM
Portugal is planning to close a legal loophole that currently allows cryptocurrency investors to avoid paying taxes on their transactions.
Finance minister Fernando Medina said on Thursday that the government intends to present a new legal framework that would ensure a balance between tax "fairness" and the country's international "competitiveness." Currently, Portugal is one of the few countries in Europe where cryptocurrency transactions are not subject to taxation because they are not considered currencies or financial assets. This has made the country particularly attractive to cryptocurrency investors.
Under the new rules, individuals would have to pay VAT or capital gains taxes on their purchases and sales of crypto assets. Only professional activities paid in crypto would be taxed.
The government's announcement comes as cryptocurrency investments continue to gain ground in the country, particularly in the real estate sector.
In early May, the first sale of property paid for in Bitcoin without conversion to euros was completed in Portugal. The three-bedroom apartment, which was worth €110,000, was sold for 3 Bitcoins in Braga, a major city in northwest Portugal.
Real estate agency Zome, which was the intermediary in the sale, said that the transaction was made possible by a new regulation by the Order of Notaries approved at the end of April.
Zome spokesman Carlos Santos told AFP that cryptocurrency real estate transactions must be preceded by a "more extensive" verification procedure than in a traditional sale, in order to "check the source of funds under the law on money laundering." Despite the volatile crypto market, the agency sees new opportunities for development.
Finance minister Fernando Medina said on Thursday that the government intends to present a new legal framework that would ensure a balance between tax "fairness" and the country's international "competitiveness." Currently, Portugal is one of the few countries in Europe where cryptocurrency transactions are not subject to taxation because they are not considered currencies or financial assets. This has made the country particularly attractive to cryptocurrency investors.
Under the new rules, individuals would have to pay VAT or capital gains taxes on their purchases and sales of crypto assets. Only professional activities paid in crypto would be taxed.
The government's announcement comes as cryptocurrency investments continue to gain ground in the country, particularly in the real estate sector.
In early May, the first sale of property paid for in Bitcoin without conversion to euros was completed in Portugal. The three-bedroom apartment, which was worth €110,000, was sold for 3 Bitcoins in Braga, a major city in northwest Portugal.
Real estate agency Zome, which was the intermediary in the sale, said that the transaction was made possible by a new regulation by the Order of Notaries approved at the end of April.
Zome spokesman Carlos Santos told AFP that cryptocurrency real estate transactions must be preceded by a "more extensive" verification procedure than in a traditional sale, in order to "check the source of funds under the law on money laundering." Despite the volatile crypto market, the agency sees new opportunities for development.