The Italian government plans to significantly increase the capital gains tax on bitcoin while removing the lower threshold for charging its ‘web tax.’
A bill passed by the Italian Council of Ministers could raise the tax on gains received via bitcoin investments by 16%, taking it from the current 26% to 42%. Maurizio Leo, Italy’s Deputy Economy Minister, delivered the announcement in an October 16 news conference, speaking at Palazzo Chighi on a new budget bill amidst the council to its approval.
One aspect of the bill was increasing the bitcoin tax. Another included amending the country’s ‘web tax,’ officially known as the Digital Services Tax (DST). DST was introduced in 2019. The bill Chighi spoke about looks to remove the minimum barrier for firms to be charged with the DST. That tax will apply to any company making 5.5 million euros in revenue by operating a digital service. Companies that make more than in a calendar are also hit with the DST.
Leo mentioned at the conference, “On capital gains from Bitcoin, the withholding tax increases from 26% to 42%. On web tax revenues we are working to eliminate the ceiling of 750 million euros and 5 million in Italy, therefore we are eliminating the thresholds.”
Italy Introduces Budget That Will Cause Banks and Insurance Firms to Cough Up Money
As the capital gains tax and DST can affect crypto and web-based businesses, TradFi businesses are not left alone. Leo’s announcement came alongside the Italian government approving a 30 billion euro budget for 2025, which the government will fund by taxing the country’s banks and insurers. While the government has given its nod, the parliament has yet to do so and make it law.
If fully approved, the funds will go toward enhancing healthcare infrastructure for the weakest sections of the country’s population, according to Prime Minister Georgia Meloni. The October 15 announcement mentioned domestic banks and insurers shelling about $3.5 billion euros for the initiative.
“Today, in the Council of Ministers, we approved the budget law, an intervention that puts citizens, families and the relaunch of our Nation at the center,” Menoni mentioned in an X post. She continued to add that the government “will make the tax cut on workers structural, and 3.5 billion from banks and insurance companies will be allocated to Healthcare and the most vulnerable to ensure better services that are closer to everyone’s needs.”
