Italy Raises BTC Capital Gains Tax From 26% to 42%, Triggering Crypto Exodus

Italy, well-known for its architecture, culture, art, opera, literature, film, and fashion, is about to experience a one of a kind crypto exodus.

Italy, renowned for its captivating architecture, rich culture, and culinary delights, is poised to witness an unprecedented crypto exodus. According to recent reports, the Italian government is preparing to increase the capital gains tax on Bitcoin (BTC) from the current 26% to a staggering 42%.

This decision is part of Italy's broader strategy to boost its revenue by 0.2% of gross domestic product (GDP). In an effort to stimulate the economy, the government aims to add 4 billion euros ($4.35 billion) by 2025. To achieve this goal, it plans to generate revenue through revised tax regulations on banks, insurance products, and gaming licenses.

Currently, Italy has one of the highest tax burdens among developed nations. Market analysts are speculating that a 42% capital gains tax on BTC will likely prompt investors to relocate to countries with more favorable tax regimes.

In September 2024, Italy's inflation rate dropped below 1%, putting pressure on the European Central Bank to lower interest rates. As inflation cools in other European countries and the United States, Italy anticipates a surge in BTC price, leading to substantial capital gains and investment cash-outs.

Economy Minister Giancarlo Giorgetti is expected to hold a press conference on Wednesday to provide further details on the government's draft budgetary plan (DBP). At the time of writing, BTC price remains largely unaffected by the news. According to on-chain data from CoinGecko, Bitcoin is valued at $67,672, indicating a 3.1% increase over the past 24 hours.

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