With the maneuverthe government announced it was raising the tax on bitcoin capital gains to 42%. Francesco Casarella, founder of Breakfast on Wall Street, what does this tax mean and what is it?
“It means that for earnings above 2,000 euros, starting from 2025, taxation will rise from 26% (the rate in force today) to 42%. According to the Government, it was born as one of the many “financing” methods to raise useful capital for the new financial package of around 30 billion approved in the last Council of Ministers”.
Is this taxation on cryptocurrencies unique in the world or do measures like this also apply in other countries?
“Today the average rate in Europe is around 15-16%, so this would lead to Italy being the most penalizing European country on this issue, and certainly among the top places also on a global level”.
What is your opinion on this maxi-tax?
“I consider it ineffective for a whole series of reasons, first of all the fact that by 2024 cryptocurrency holders could decide to sell their assets and move to other types of products (thus making the taxation ineffective). In addition to this, large capitals could (having the right) move capital out of our country, and above all it would damage on the one hand the related activities of the crypto industry in Italy, with all the consequences of the case (closure of companies , loss of jobs and economic value), but it also provides a specific message, that is, everything that is innovative struggles to find space here”.
What could be the concrete effects for those who hold cryptocurrencies and the consequences on this market in general?
“Considering that the average amount invested is between 1000 and 2000 euros, the impact would be insignificant (and consequently the collection by the State). The consequences and the approach to investments, crucial for our country but also for foreign operators, are more relevant regarding the type of message that passes from this maneuver. In any case, as mentioned, in addition to being able to move towards other forms of investment (making the maneuver ineffective), the great risk is an increase in non-declaration, as the danger of a sort of “moral hazard” would remain alive (I do not declare, at most I pay the fine, given that I would pay 42% anyway, which is what must be avoided especially with this type of asset class”.
The impression is that the measure serves to find other resources for the maneuver. But is there a risk that it becomes a disincentive towards this tool?
“Certainly yes, with investors who could (in the best case) move towards other less taxed instruments, in the worst case, leaving the money idle and idle in the accounts or under the mattress, but inflation is relentless in these cases and erodes these you save over time.”
In your opinion, does the government think from a “punitive” perspective towards an instrument that is perhaps not fully understood?
“I don’t think it’s a punitive logic, but rather a lack of in-depth knowledge of the sector, and more generally of the dynamics that govern markets and investments. I hope for a discussion with the players in the sector so that we can open a discussion table and re-evaluate more optimal solutions”.
